10-QPeriod: Q1 FY2022

ELI LILLY & Co Quarterly Report for Q1 Ended Mar 31, 2022

Filed April 29, 2022For Securities:LLY

Summary

Eli Lilly and Company reported robust revenue growth of 15% year-over-year for the first quarter of 2022, reaching $7.81 billion. This increase was primarily driven by strong volume growth, particularly from key products like Trulicity, Verzenio, and Jardiance, as well as significant contributions from COVID-19 antibody treatments. Despite the strong top-line performance, the company's net income saw a substantial increase of 40% to $1.9 billion, translating to a diluted EPS of $2.10, up from $1.49 in the prior year period. The company's operational expenses showed a mixed trend. Research and development expenses saw a slight decrease, attributed to lower spending on COVID-19 antibody development, while marketing, selling, and administrative costs remained relatively flat. A notable item was the reduction in acquired in-process R&D expenses. The company also repurchased $1.5 billion in shares during the quarter, signaling a continued commitment to returning capital to shareholders. Eli Lilly maintains a strong financial position with ample liquidity to fund its operations and pipeline development.

Financial Highlights

51 data points
Beta

Revenue

$7.81B

73.5% Gross Margin

Net Income

$1.90B

24.4% Net Margin

EPS (Diluted)

$2.10

Total Assets

$46.92B

Cash & Equivalents

$2.46B

Free Cash Flow

$2.52B

Financial Statements
Beta
Revenue$7.81B
Cost of Revenue$2.07B
Gross Profit$5.74B
R&D Expenses$1.61B
SG&A Expenses$1.56B
Interest Expense$84.90M
Net Income$1.90B
EPS (Basic)$2.11
EPS (Diluted)$2.10
Shares Outstanding (Basic)903.70M
Shares Outstanding (Diluted)906.40M

Key Highlights

  • 1Revenue increased by 15% to $7.81 billion, driven by strong volume growth in key products and COVID-19 antibody treatments.
  • 2Net income grew by 40% to $1.9 billion, with diluted Earnings Per Share (EPS) rising to $2.10 from $1.49.
  • 3Gross margin improved to 73.5% from 72.4%, supported by favorable product mix and reduced impact from foreign exchange on international inventories.
  • 4Research and Development expenses decreased by 4% due to lower COVID-19 antibody development costs, while development for late-stage assets increased.
  • 5The company repurchased $1.5 billion of its shares under its authorized share repurchase program.
  • 6Key products like Trulicity, Verzenio, and Jardiance demonstrated significant revenue growth.
  • 7Revenue from COVID-19 antibodies remained substantial but is expected to be limited starting in the second quarter of 2022.

Frequently Asked Questions

The 15% year-over-year revenue increase to $7.81 billion was primarily driven by strong volume growth across several key products, including Trulicity, Verzenio, and Jardiance. Additionally, sales of COVID-19 antibody treatments contributed significantly to the top-line performance during the quarter.

Eli Lilly experienced a substantial improvement in profitability, with net income increasing by 40% to $1.9 billion. This resulted in diluted Earnings Per Share (EPS) of $2.10, an increase from $1.49 in the prior year's first quarter, indicating strong operational efficiency and revenue growth translating to the bottom line.

While COVID-19 antibody treatments generated substantial revenue in the first quarter of 2022, the company expects this revenue to be limited starting from the second quarter. This is due to factors such as the availability of competing therapies, evolving pandemic dynamics, and potential revisions to Emergency Use Authorizations (EUAs) by regulatory bodies.

Research and development expenses decreased by 4% in the first quarter. This reduction was largely due to lower development expenses related to COVID-19 antibodies. However, the company has increased development expenses for its late-stage assets, reflecting its continued commitment to advancing its pipeline.