Elanco Animal Health Incorporated · NYSE:ELAN
Elanco Animal Health — Q4 2024 Earnings Presentation
42 slides from Elanco Animal Health's earnings presentation, Feb 25, 2025
Slide 1: 2024 Earnings – Fourth Quarter
2024 Earnings – Fourth Quarter D February 25, 2025
Slide 2: Notices and Disclaimers
2024 | Q4 Earnings Notices and Disclaimers Forward-Looking Statements. This presentation contains forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements concerning product launches and revenue from such products, our 2025 full year and
Slide 3: On Today's Call
2024 | Q4 Earnings On Today’s Call Jeff Simmons Todd Young Elanco Animal Health Elanco Animal Health President and Executive Vice President, Chief Executive Officer Chief Financial Officer 3
Slide 4: Accelerating Growth Through Delivering Our Diverse Portfolio of Innovation
2024 | Q4 Earnings Accelerating Growth Solid Q4 Performance Through Delivering Our Revenue, adj. EBITDA, adj. EPS, and net leverage all in line with Diverse Portfolio of guidance despite emerging FX headwinds; 4% organic CC2 revenue growth Innovation Diverse Portfolio, Stabilizing Base 6th consecuti
Slide 5: 2025 Guidance vs. November Outlook Fully Driven by FX Headwinds
2025 Guidance vs. November Outlook Fully Driven by FX Headwinds Q4 Results and FX Impact vs. November Call 2025 Guidance and FX Impact vs. November Outlook1 $ millions, except per share values Shift from Expected $1,020 FX Headwind Revenue $10 Revenue ~$110M 2025 Guidance: Nov. Outlook: $1,000 Guida
Slide 6: 4% Organic Constant Currency Revenue Growth
2024 | Q4 Earnings Q4 2023 to Q4 2024 Revenue Bridge 4% Organic Constant Currency Revenue Growth Revenue 4% $ millions 6% Growth1 2% Growth Growth1 $(43) 6% 11% Growth Flat1 $1,035 Growth $(9) 2% $1,020 Growth Q4 2023 Aqua FX Rates Divestiture & CMO US Int’l US Int’l Q4 2024 Actual Actual Numbers ma
Slide 7: Deliver Consistent, High-Impact Innovation
2024 | Q4 Earnings Deliver Consistent, High-Impact Innovation 5 New Products Experior Credelio Received 2024 Achieved Quattro U.S. approval and blockbuster status Launched and market in the U.S. alone shipped product authorization in January 2025 IPP Po Innovation, it on Optimize Our Diverse Portfol
Slide 8: 2025 Innovation Sales Target Raised
2024 | Q4 Earnings 2025 Innovation Sales Target Raised: Now Expected to $640-$720 Deliver an Incremental Raised from $600-$700 $640-$720 Million Big 6 Innovation $461 Exceeded early in launch $420-450 Target Pet curve with this Health portfolio exceeding $275 the corporate gross margin average $133
Slide 9: Updates on Select Major Innovation Products
2024 | Q4 Earnings Updates on Select Major Innovation Products • Achieved use in over 8,000 U.S. clinics, • January U.S. launch, ahead of the representing penetration of nearly 30% • Accelerated launch trajectory through major parasiticide season DTC investment • Momentum driving acceleration of DTC
Slide 10: Financial Results
Financial Results Fourth Quarter 2024 10
Slide 11: Impact of Price, Rate, and Volume on Revenue
2024 | Q4 Earnings Fourth Quarter 2024 Impact of Price, Rate, and Volume on Revenue Organic1 Aqua Organic CC2 Revenue Price FX Rate Volume Volume Total Change Pet Health $439 3% 0% 3% 0% 6% 6% Cattle $253 (2)% 2% 3% Poultry $213 (1)% (3)% (2)% Swine $104 (1)% 6% 7% Aqua $0 (100)% Farm Animal $570 3%
Slide 12: Revenue by Geography and Species
2024 | Q4 Earnings Fourth Quarter 2024 Revenue by Geography and Species Organic CC1 2024 2023 Change (%) Change (%) US Pet Health $253 $247 2% 2% Int’l Pet Health $186 $169 10% 11% Total Pet Health $439 $416 6% 6% US Farm Animal $223 $211 6% 6% Int’l Farm Animal1 $347 $399 (13)% 0% Total Farm Animal
Slide 13: Adjusted Income Statement Highlights
2024 | Q4 Earnings Fourth Quarter 2024 Adjusted1 Income Statement Highlights Including Impact from Aqua Divestiture $ millions, except per share values 2024 2023 Change ($)2 Change (%)2 Revenue $1,020 $1,035 $(15) (1)% Cost of Sales $501 $516 $(15) (3)% Adjusted Gross Profit $519 $519 $0 0% Adjusted
Slide 14: Adjusted EBITDA and Adjusted EPS Drivers
2024 | Q4 Earnings Fourth Quarter 2024 Adjusted EBITDA and Adjusted EPS Drivers Q4 Adjusted EBITDA Q4 Adjusted EPS $ millions +$42 vs. Prior Year Excluding Aqua & FX $0.04 $0.06 $0.14 ~$(0.01) $(23) $177 FX impact $165 ~$(7) $(0.04) $0.08 Q4 2023 Aqua FX Gross Operating Q4 2024 Q4 2023 Aqua EBITDA I
Slide 15: Adjusted Income Statement Highlights
2024 | Q4 Earnings Full Year 2024 Adjusted1 Income Statement Highlights Including Impact from Aqua Divestiture $ millions, except per share values 2024 2023 Change ($)2 Change (%)2 Revenue $4,439 $4,417 $22 0% Cost of Sales $2,003 $1,929 $74 4% Adjusted Gross Profit $2,436 $2,488 $(52) (2)% Adjusted
Slide 16: Adjusted EBITDA and Adjusted EPS Drivers
2024 | Q4 Earnings 2023 to 2024 Full Year Bridge Adjusted EBITDA and Adjusted EPS Drivers 2024 Adjusted EBITDA 2024 Adjusted EPS $ millions $0.02 vs. Prior $(53) $0.04 Year $979 $24 $(30) $(69) $(0.09) ~$(10) vs. Prior $0.09 $0.91 Year $0.89 $910 $(0.02) 1 Full Year Aqua FX Gross Profit Operating Fu
Slide 17: Key Balance Sheet and Cash Flow Metrics
2024 | Q4 Earnings Key Balance Sheet and Cash Flow Metrics Debt Balances as of December 31, 2024 $38M of Debt Paydown in Q4 2024 $ millions Adjusted net leverage ratio2 decreased to 4.3x from 5.6x at the end of 2023 $4,349 $468 Full Year Gross Debt Reduction of $1.48B Exceeded 2024 deleveraging goal
Slide 18: Financial Guidance
Financial Guidance First Quarter and Full Year 2025 18
Slide 19: Financial Guidance 2025 Full Year
2024 | Q4 Earnings 2025 Full Year Financial February Comments Guidance Revenue $4,445 - $4,510 Expect price growth of 2% Reported Net (Loss) Income $(25) - $7 $ millions, except Adjusted EBITDA1 $830 - $870 Includes operating expenses up 6% CC per share values Reported Diluted EPS $(0.05) - $0.01 Ad
Slide 20: Expect MSD Organic CC Revenue Growth Driven by Our Diverse Portfolio of Innovation
2024 | Q4 Earnings 2024 to 2025 Full Year Revenue Bridge Expect MSD Organic CC1 Revenue Growth Driven by Our Diverse Portfolio of Innovation 4% - 6% Organic CC1 $ millions Growth ~$2302 ~$15 $4,439 $4,445- $4,510 $4,439 $4,417 $4,412 ($80) ~$(110) $4,249 ~$(15) 2024 Aqua FX Organic Contract Innovati
Slide 21: Adjusted EBITDA and Adjusted EPS Drivers
2024 | Q4 Earnings 2024 to 2025 Full Year Bridge Adjusted EBITDA and Adjusted EPS Drivers 2025 Adjusted EBITDA 2025 Adjusted EPS $ millions ~$135 $910 $0.91 ~$(40) ~$(0.07) ~$0.04 ~$0.03 $0.80 - $0.84 ~$(110) $0.86 $0.87- $830 - $0.89 $0.95 ~$(45) $825 $870 2024 Aqua FX Pricing, OPEX & 2025 2024 FX
Slide 22: Financial Guidance First Quarter 2025
2024 | Q4 Earnings First Quarter 2025 Financial Q1 Guidance Comments Guidance Revenue $1,155 - $1,180 Expect 2-4% organic CC2 growth Reported Net Income $13 - $41 $ millions, except Adjusted EBITDA1 $240 - $260 Includes operating expenses up 6-8% CC per share values Reported Diluted EPS $0.03 - $0.0
Slide 23: Tailwinds & Headwinds Driving 2025 Guidance Assumptions
2024 | Q4 Earnings Tailwinds & Headwinds Driving 2025 Guidance Assumptions Tailwinds Headwinds Innovation sales ramp to $640-$720M Foreign exchange rate impact with multiple drivers, including: Zenrelia, Credelio Quattro, AdTab, Competition in U.S. Pet Health vet clinic business CPMA, Bovaer, Experi
Slide 24: Elanco's Strategic Trajectory: Powerful 2025 & Beyond
Elanco’s Strategic Trajectory: Powerful 2025 & Beyond Momentum into 2025 2021-2024 Poised for Sustainable Revenue Growth Innovation Delivered & Multiple potential blockbusters Enhanced in market and a stabilizing base 2019-2021 Capabilities to drive growth Balanced Mix & Accelerating contribution fr
Slide 25: Appendix
Appendix Reference slides and GAAP reported to non-GAAP adjusted reconciliations 25
Slide 26: Impact of Price, Rate, and Volume on Revenue
2024 | Q4 Earnings Full Year 2024 Impact of Price, Rate, and Volume on Revenue Organic1 Aqua Organic CC2 Revenue Price FX Rate Volume Volume Total Change Pet Health $2,143 3% 0% (1)% 0% 2% 2% Cattle $1,007 (1)% 6% 7% Poultry $796 (1)% 4% 5% Swine $366 (1)% (4)% (3)% Aqua $81 (52)% Farm Animal $2,250
Slide 27: Revenue by Geography and Species
2024 | Q4 Earnings Full Year 2024 Revenue by Geography and Species Organic CC1 2024 2023 Total (%) Change (%) US Pet Health $1,213 $1,242 (2)% (2)% Int’l Pet Health $930 $862 8% 9% Total Pet Health $2,143 $2,104 2% 2% US Farm Animal $819 $729 12% 12% Int’l Farm Animal $1,431 $1,542 (7)% 0% Total Far
Slide 28: Revenue Performance by Top Ten Countries
2024 | Q4 Earnings Full Year 2024 Organic CC Revenue Total % of Total Change1 Performance by United States $2,036 46% 3% Top Ten China $196 4% -3% Brazil $190 4% 9% Countries United Kingdom $159 4% 4% Italy $120 3% 5% Canada $118 3% 10% Mexico $117 3% 6% France $117 3% 11% Spain $88 2% 32% Germany $
Slide 29: Revenue Performance for Select Products
2024 | Q4 Earnings Full Year 2024 Revenue 2024 Revenue % of Total CC Change1 Performance for Select 2 $458 10% 2% Products $365 8% 10% $288 6% 16% $260 6% 8% 3 $221 5% 14% Note: Reported revenue in millions. Numbers may not add due to rounding. 1Constant Currency (CC) is a non-GAAP financial measure
Slide 30: Seven Potential Blockbusters Expected to Fuel Revenue Growth
2024 | Q4 Earnings n Po tio Seven Potential Blockbusters Expected to Fuel rtf a Innov olio Customer Revenue Growth in 2025 and Beyond Pr oductivity Peak Sales Asset Market Focus Species Approval1 Launch2 Opportunity3 Commentary First-in-class; Combo clearance Experior U.S. Beef approval to drive exp
Slide 31: Financial Guidance & Additional Assumptions Full Year 2025
2024 | Q4 Earnings Full Year 2025 Financial February Guidance Total Revenue $4,445 – $4,510 Adjusted Gross Margin1 53.9% – 54.6% & Additional Assumptions Operating Expenses $1,700 – $1,720 Adjusted EBITDA1 $830 – $870 $ millions, except Adjusted EBITDA Margin1 18.7% – 19.3% per share values Deprecia
Slide 32: Adjusted EBITDA Reconciliation Q4 2024
2024 | Q4 Earnings Fourth Quarter 2024 Adjusted 2024 2023 EBITDA Reported Net Loss $(8) $(141) Reconciliation Net Interest Expense $46 $67 Income Tax (Benefit) Expense $(43) $14 $ millions Depreciation and Amortization $164 $171 EBITDA $159 $111 Non-GAAP Adjustments Asset Impairment, Restructuring,
Slide 33: Reconciliation of GAAP Reported to Non-GAAP Adjusted
2024 | Q4 Earnings Fourth Quarter 2024 Reconciliation 2024 2023 of GAAP GAAP Adjusted Non- GAAP Adjusted Non- Reported Items GAAP Reported Items GAAP Reported to Cost of Sales $501 $0 $501 $516 $0 $516 Non-GAAP Amortization of Intangible Assets $130 $130 $0 $138 $138 $0 Adjusted Asset Impairment, Re
Slide 34: Details of Adjustments to Certain GAAP Reported Measures
2024 | Q4 Earnings Fourth Quarter 2024 Details of For the three months ended December 31, 2024 and 2023: Adjustments to (1) Adjustments of $7 million for the three months ended December 31, 2024, primarily related to intangible asset impairments. Adjustments of $36 million for the three months ended
Slide 35: Adjusted EBITDA Reconciliation Full Year 2024
2024 | Q4 Earnings Full Year 2024 Adjusted 2024 2023 EBITDA Reported Net Income (Loss) $338 $(1,231) Reconciliation Net Interest Expense $235 $277 Income Tax Expense $150 $36 $ millions Depreciation and Amortization $662 $694 EBITDA $1,385 $(224) Non-GAAP Adjustments Cost of Sales $0 $2 Asset Impair
Slide 36: Reconciliation of GAAP Reported to Non-GAAP Adjusted
2024 | Q4 Earnings Full Year 2024 Reconciliation 2024 2023 of GAAP GAAP Adjusted Non- GAAP Adjusted Non- Reported Items GAAP Reported Items GAAP Reported to Cost of Sales $2,003 $0 $2,003 $1,931 $2 $1,929 Non-GAAP Amortization of Intangible Assets $527 $527 $0 $548 $548 $0 Adjusted Asset Impairment,
Slide 37: Details of Adjustments to Certain GAAP Reported Measures
2024 | Q4 Earnings Full Year 2024 Details of For the year ended December 31, 2024 and 2023: Adjustments to (1) Adjustments of $150 million for the year ended December 31, 2024, principally included impairment charges of $53 million related to a pet health IPR&D asset (IL-4R) and $15 million of asset
Slide 38: EBITDA Guidance Reconciliation Full Year 2025
2024 | Q4 Earnings Full Year 2025 EBITDA Guidance Reported Net (Loss) Income $(25) - $7 Reconciliation Net Interest Expense Approx. $200 Income Tax (Income) Expense $(18) - $(6) $ millions Depreciation and Amortization Approx. $640 EBITDA $792 - $842 Non-GAAP Adjustments Asset Impairment, Restructur
Slide 39: EPS Guidance Reconciliation Full Year 2025
2024 | Q4 Earnings Full Year 2025 EPS Guidance Reconciliation Reported (Loss) Earnings per Share $(0.05) - $0.01 Amortization of Intangible Assets Approx. $1.02 Asset Impairment, Restructuring, and Other Special Charges $0.05 - $0.03 Other Expense, Net $0.03 - $0.04 Subtotal $1.10 - $1.09 Tax Impact
Slide 40: EBITDA Guidance Reconciliation First Quarter 2025
2024 | Q4 Earnings First Quarter 2025 EBITDA Guidance Reconciliation Reported Net Income $13 - $41 Net Interest Expense Approx. $45 $ millions Income Tax Expense (Income) $0 - $(3) Depreciation and Amortization Approx. $160 EBITDA $219 - $244 Non-GAAP Adjustments Asset Impairment, Restructuring, and
Slide 41: EPS Guidance Reconciliation First Quarter 2025
2024 | Q4 Earnings First Quarter 2025 EPS Guidance Reconciliation Reported Earnings per Share $0.03 - $0.08 Amortization of Intangible Assets Approx. $0.26 Asset Impairment, Restructuring, and Other Special Charges1 $0.03 - $0.02 Other Expense, Net $0.01 - $0.01 Subtotal $0.30 - $0.29 Tax Impact of
Slide 42: © 2025 Elanco or its affiliates
© 2025 Elanco or its affiliates