01—Abstract
Summary
Summary of the 10-K/A filed February 13, 2020. Cited figures are marked; the original filing is the authoritative source.
Amgen Inc. (AMGN) filed its Annual Report (Form 10-K) for the fiscal year ended December 31, 2019.
This filing's primary purpose was to include the conformed signature of its independent auditor, Ernst & Young LLP, which was inadvertently omitted from the original filing. Therefore, this amended filing does not contain new financial information or reflect events occurring after the original filing date of February 12, 2020. Investors should refer to the original Form 10-K for comprehensive financial details.
The audit report from Ernst & Young LLP expresses an unqualified opinion on Amgen's consolidated financial statements for the years ended December 31, 2019 and 2018, and its internal control over financial reporting as of December 31, 2019. Two critical audit matters were highlighted: the estimation of sales deductions and the accounting for unrecognized tax benefits, both involving significant management judgment and complexity.
02—Key points
Key Highlights
- The filing is an amendment to the original 10-K, primarily to add the auditor's signature.
- No new financial information or subsequent events are disclosed in this amendment.
- Ernst & Young LLP provided an unqualified opinion on Amgen's financial statements for 2019 and 2018.
- The auditor also issued an unqualified opinion on Amgen's internal control over financial reporting as of December 31, 2019.
- Sales deductions, totaling $3.9 billion as of December 31, 2019, represent a critical audit matter due to complexity and judgment in estimation.
- Unrecognized tax benefits, including transfer pricing, amounting to $3.3 billion as of December 31, 2019, are also a critical audit matter due to tax law complexity and judgment.
- The auditor has a long-standing relationship with Amgen, serving as its auditor since 1980.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2019, Amgen Inc kept $0.34.
- Revenue$23.36B100.0%
- Cost of revenue−$4.36B18.6%
- Gross profit$19.01B81.4%
- Operating costs−$9.33B39.9%
- Operating income$9.67B41.4%
- Interest, other & tax−$1.83B7.8%
- Net income$7.84B33.6%
Where FY2019 revenue went
$23.36B- Net income: $7.84B, 34% of revenue
- SG&A: $5.15B, 22% of revenue
- Cost of revenue: $4.36B, 19% of revenue
- Other operating costs: $4.18B, 18% of revenue
- Interest, other & tax: $1.83B, 7.8% of revenue
Kept 34% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-K/AFY2019filed February 13, 2020Financial Statements
FY2019 against FY2018
| Line item | FY2019FY2018 | Change |
|---|---|---|
| Revenue | $23.36B$23.75B | −1.6% |
| Cost of Revenue | $4.36B$4.10B | +6.2% |
| Gross Profit | $19.01B$19.65B | −3.3% |
| SG&A Expenses | $5.15B$5.33B | −3.4% |
| Operating Expenses | $13.69B$13.48B | +1.5% |
| Operating Income | $9.67B$10.26B | −5.7% |
| Interest Expense | $1.29B$1.39B | −7.4% |
| Net Income | $7.84B$8.39B | −6.6% |
| EPS (Basic) | $12.96$12.70 | +2.0% |
| EPS (Diluted) | $12.88$12.62 | +2.1% |
| Shares Outstanding (Basic) | 605.00M661.00M | −8.5% |
| Shares Outstanding (Diluted) | 609.00M665.00M | −8.4% |
05—Questions
Frequently Asked Questions
What is the main reason for this amended filing?
This filing is an amendment (10-K/A) to the original Annual Report on Form 10-K for the year ended December 31, 2019. The sole purpose of this amendment is to include the conformed signature of Amgen's independent auditor, Ernst & Young LLP, which was mistakenly omitted from the original filing.
Does this amendment provide updated financial results or disclose new events?
No, this amendment does not modify or update the financial position, results of operations, cash flows, or any other disclosures or exhibits from the original Form 10-K. It also does not reflect any events that have occurred since the original filing date of February 12, 2020. Investors should refer to the original 10-K for financial details.
What are the key areas of concern identified by the independent auditor?
The auditor identified two critical audit matters: 1) The estimation of sales deductions, which involve significant judgment due to complexity and materiality ($3.9 billion as of December 31, 2019). 2) The accounting for unrecognized tax benefits, particularly related to transfer pricing, which also requires significant judgment and is complex ($3.3 billion as of December 31, 2019).
What is the auditor's opinion on Amgen's financial statements?
Ernst & Young LLP provided an unqualified opinion on Amgen's consolidated financial statements for the years ended December 31, 2019, and 2018, stating that they present fairly, in all material respects, the company's financial position and results of operations in conformity with U.S. generally accepted accounting principles.
06—Continue