How did Bristol Myers Squibb perform in Q4 and full-year 2023?

Q4 2023 revenues were $11.5 billion, up 1%, with non-GAAP EPS of $1.70, down 7% from $1.82. For the full year, revenues fell 2% to $45.0 billion and non-GAAP EPS fell 2% to $7.51. Growth in the in-line and new product portfolio partially offset steep declines in Revlimid.

What is the 2024 guidance?

BMS guided 2024 non-GAAP EPS to $7.10 to $7.40, with total revenues expected to rise by a low single-digit percentage, both reported and ex-FX. The guidance includes Mirati but excludes the pending Karuna and RayzeBio acquisitions, future Acquired IPRD charges, and divestitures. Management also expects roughly $800 million of Q1 2024 upfront charges, about $0.30 of dilution from financing and about $0.13 from operations.

Why did GAAP EPS differ so much from non-GAAP EPS in 2023?

GAAP EPS of $3.86 for the year is well below non-GAAP EPS of $7.51 mainly because of amortization of acquired intangible assets of about $9.0 billion, which is excluded from non-GAAP results, along with Acquired IPRD charges, restructuring and integration costs, and equity investment impacts. In Q4, GAAP EPS was also boosted by an income tax benefit that reflects a valuation allowance reversal.

What are the main growth drivers and risks for BMS?

Growth drivers include Opdivo (up 9% in 2023), the new product portfolio (up 77% to $3.6 billion), and recent launches such as Reblozyl, Camzyos, Breyanzi and Zeposia. Key risks include the continued erosion of Revlimid (down 39% in 2023), pricing pressure, and upcoming loss-of-exclusivity events. The filing also notes that Opdualag's RELATIVITY-123 colorectal trial was discontinued for futility, and the Eliquis franchise faced lower international pricing.

What did BMS return to shareholders in 2023?

BMS raised its quarterly dividend to $0.60 per share, an annual rate of $2.40 for 2024, marking 15 consecutive years of increases and 92 consecutive years of dividend payments. The board also authorized an additional $3 billion in share repurchases, bringing the total outstanding authorization to about $5 billion. Dividend decisions remain subject to board approval.

BMY 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed February 2, 2024. Cited figures are marked; the original filing is the authoritative source.

Bristol Myers Squibb's Q4 and full-year 2023 results, reported February 2, 2024, showed a mixed picture: top-line stability with strong growth from the new product portfolio offset by steep erosion of Revlimid.

Q4 revenues were $11.5 billion^a, up 1% reported and flat ex-FX, with the in-line and new product portfolio up 9% to $9.8 billion. Full-year revenues fell 2% to $45.0 billion, but the in-line and new product portfolio grew 7% to $37.9 billion, while recent loss-of-exclusivity products (Revlimid and Abraxane) declined 34% to $7.1 billion. GAAP EPS was $0.87 in Q4 and $3.86 for the year; non-GAAP EPS was $1.70 in Q4 and $7.51 for the year, down 2% from $7.70 in 2022.

The company's strategic focus centered on portfolio diversification through business development. BMS completed the acquisition of Mirati Therapeutics in January 2024 and agreed to acquire Karuna Therapeutics and RayzeBio, both expected to close in the first half of 2024, along with a licensing collaboration with SystImmune. Management guided 2024 non-GAAP EPS to $7.10 to $7.40^b and total revenues to a low single-digit increase, excluding the pending transactions.

Management also disclosed roughly $800 million^c in upfront Acquired IPRD charges in Q1 2024 and expected dilution of about $0.30 from financing and $0.13 from operations, which investors will need to weigh against the guidance. For investors, the key questions are whether the growth portfolio (Opdivo, Reblozyl, Breyanzi, Camzyos, Zeposia, Sotyktu) can offset the Revlimid cliff and the upcoming Eliquis and other patent expirations, and whether the pending acquisitions create long-term value.

The company also announced a $0.60^d quarterly dividend, a 5.3% increase, and an additional $3 billion share repurchase authorization, bringing total authorization to about $5 billion. Net debt was $27.1 billion at year-end 2023, down from $30.1 billion a year earlier.

02—Key points

Key Highlights

Q4 2023 revenues of $11.5 billion were up 1% reported and flat ex-FX; in-line and new product portfolio revenues rose 9% to $9.8 billion, led by Reblozyl, Opdualag, Camzyos, Sotyktu, Zeposia and Breyanzi.
Full-year 2023 revenues declined 2% to $45.0 billion, while the in-line and new product portfolio grew 7% to $37.9 billion; Revlimid revenue fell 39% to $6.1 billion due to generic erosion.
Full-year 2023 non-GAAP EPS was $7.51 versus $7.70 in 2022; GAAP EPS rose to $3.86 from $2.95, helped by a non-U.S. tax ruling and lower equity investment losses.
2024 guidance calls for non-GAAP EPS of $7.10 to $7.40 and low single-digit revenue growth, excluding pending acquisitions, with a non-GAAP gross margin of about 74% and an effective tax rate of about 17.5%.
Strategic transactions: Mirati Therapeutics acquisition closed in January 2024; Karuna Therapeutics, RayzeBio and a SystImmune collaboration are expected to close in 1H 2024, with about $800 million of Q1 2024 upfront Acquired IPRD charges expected.
Capital returns: quarterly dividend raised 5.3% to $0.60 per share (annual rate $2.40), marking the 15th consecutive annual increase, and an additional $3 billion buyback authorization brings total to about $5 billion.
Balance sheet: net debt improved to $27.1 billion at December 31, 2023 from $30.1 billion a year earlier, with cash and marketable securities of $12.6 billion and operating cash flow of $4.3 billion in Q4.

03—Questions

Frequently Asked Questions

How did Bristol Myers Squibb perform in Q4 and full-year 2023?
Q4 2023 revenues were $11.5 billion, up 1%, with non-GAAP EPS of $1.70, down 7% from $1.82. For the full year, revenues fell 2% to $45.0 billion and non-GAAP EPS fell 2% to $7.51. Growth in the in-line and new product portfolio partially offset steep declines in Revlimid.
What is the 2024 guidance?
BMS guided 2024 non-GAAP EPS to $7.10 to $7.40, with total revenues expected to rise by a low single-digit percentage, both reported and ex-FX. The guidance includes Mirati but excludes the pending Karuna and RayzeBio acquisitions, future Acquired IPRD charges, and divestitures. Management also expects roughly $800 million of Q1 2024 upfront charges, about $0.30 of dilution from financing and about $0.13 from operations.
Why did GAAP EPS differ so much from non-GAAP EPS in 2023?
GAAP EPS of $3.86 for the year is well below non-GAAP EPS of $7.51 mainly because of amortization of acquired intangible assets of about $9.0 billion, which is excluded from non-GAAP results, along with Acquired IPRD charges, restructuring and integration costs, and equity investment impacts. In Q4, GAAP EPS was also boosted by an income tax benefit that reflects a valuation allowance reversal.
What are the main growth drivers and risks for BMS?
Growth drivers include Opdivo (up 9% in 2023), the new product portfolio (up 77% to $3.6 billion), and recent launches such as Reblozyl, Camzyos, Breyanzi and Zeposia. Key risks include the continued erosion of Revlimid (down 39% in 2023), pricing pressure, and upcoming loss-of-exclusivity events. The filing also notes that Opdualag's RELATIVITY-123 colorectal trial was discontinued for futility, and the Eliquis franchise faced lower international pricing.
What did BMS return to shareholders in 2023?
BMS raised its quarterly dividend to $0.60 per share, an annual rate of $2.40 for 2024, marking 15 consecutive years of increases and 92 consecutive years of dividend payments. The board also authorized an additional $3 billion in share repurchases, bringing the total outstanding authorization to about $5 billion. Dividend decisions remain subject to board approval.

04—Continue

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