Slide 1: Second Quarter 2013 Earnings Teleconference
Second Quarter 2013 Earnings Teleconference July 30, 2013
Slide 2: Introduction
Introduction Chuck Triano Senior Vice President, Investor Relations Second Quarter 2013 Earnings
Slide 3: Forward-Looking Statements and Non-GAAP Financial Information
Forward-Looking Statements and Non-GAAP Financial Information ● Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements. The factors that could cause actual results to differ ar
Slide 4: Opening Remarks
Opening Remarks Ian Read Chairman and Chief Executive Officer Second Quarter 2013 Earnings
Slide 5: CEO Perspectives
CEO Perspectives ● Q2 2013 had solid operational revenue growth in a number of areas ● Continue to expect 2H 2013 will be stronger than 1H 2013 in Emerging Markets Now expect mid-single-digit operational revenue growth for FY 2013 in this region ● Completed disposition of Zoetis; Generated ~$17.2
Slide 6: Additional CEO Perspectives
Additional CEO Perspectives ● Announced internal separation of our commercial and management structure into Innovative and Value business segments Will integrate Emerging Markets fully into each of these segments Innovative Products Group Vaccines, Oncology & Value Products Group Consumer Healthca
Slide 7: Financial Review
Financial Review Frank D’Amelio Executive Vice President & Chief Financial Officer Second Quarter 2013 Earnings
Slide 8: Income Statement Highlights
Income Statement Highlights ($ Millions, Except Per Share Amounts and Percentages) Second Quarter 2013 2012 Change Revenues $12,973 $13,968 (7%) Adjusted Income(1) 4,003 4,449 (10%) Adjusted Diluted EPS(1) 0.56 0.59 (5%) Reported Net Income(2) 14,095 3,253 * Reported Diluted EPS(2) 1.98 0.43 * Repor
Slide 9: BRIC-MT Biopharmaceutical Revenue Performance
BRIC-MT(1) Biopharmaceutical Revenue Performance ($ Millions, Except Percentages) Operational Growth / (Decline) $1,228 $1,195 Q2 2013 vs. YTD 2013 vs. $1,200 Q2 2012 YTD 2012 India 8% 8% $1,000 Turkey (41%) (30%) $800 Russia 15% 13% $600 Mexico 5% 7% $400 Brazil (13%) (7%) China 14% 16% $200 BRIC-M
Slide 10: Impact of Foreign Exchange on Adjusted Income Components
Impact of Foreign Exchange on Adjusted Income(1) Components ($ Millions, Except Percentages) Favorable / (Unfavorable) Second Quarter 2013 2012 FX Impact Revenues $12,973 $13,968 ($392) (3%) Cost of Sales(1) 2,194 2,293 146 6% SI&A Expenses(1) 3,550 3,648 70 2% R&D Expenses(1) 1,521 1,565 12 1% Tota
Slide 11: 2013 Financial Guidance
2013 Financial Guidance(1)(2) Revenues $50.8 to $52.8 Billion Adjusted Cost of Sales(3) as a % of Revenues 18.0% to 19.0% Adjusted SI&A Expenses(3) $14.2 to $15.2 Billion Adjusted R&D Expenses(3) $6.1 to $6.6 Billion Adjusted Other (Income) / Deductions(3) ~$800 Million Effective Tax Rate on Adjuste
Slide 12: Key Takeaways
Key Takeaways • Results reflect product losses of exclusivity in various geographies and continued volatility in Emerging Markets Expect high-single-digit operational revenue growth in Emerging Markets during 2H 2013 Continue to mitigate the impact of product LOEs with expense discipline and sha
Slide 13: Second Quarter 2013 Earnings Teleconference Q&A Session
Second Quarter 2013 Earnings Teleconference Q&A Session July 30, 2013