Slide 1: Full Year 2022 Results Summary
Worldwide Consumer Health Sales? Consumer Health worldwide reported sales decreased (0.5)%, but increased 3.6% operationally*. Primary operational drivers: | Imodium Neutrogena SUDAFED ob) Diluted Earnings Per Share Adjusted Diluted Earnings Per Share* Decreased © Increased # $6.73 | (13.8) $10.15 |
Slide 2: 4th Quarter 2022 Earnings Call
4 Quarter 2022 th Earnings Call January 24, 2023
Slide 3: Cautionary Note on Forward-looking Statements
Cautionary Note on Forward-looking Statements This presentation contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things: future operating and financial performance, product development, market position and business strate
Slide 4: Strategic Partnerships, Collaborations & Licensing Arrangements
Strategic Partnerships, Collaborations & Licensing Arrangements During the course of this presentation, we will discuss a number of products and compounds developed in collaboration with strategic partners or licensed from other companies. The following is an acknowledgement of those relationships:
Slide 5: Agenda
Agenda 1 CEO Remarks 2 Enterprise Highlights 3 Sales Performance and Earnings Review 4 Capital Allocation and Guidance 5 Q&A Joaquin Duato Joseph J. Wolk Jessica Moore Chairman of the Board and Executive Vice President, Vice President, Chief Executive Officer Chief Financial Officer Investor Relatio
Slide 6: Joaquin Duato
Joaquin Duato Chairman of the Board and Chief Executive Officer
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Slide 17: Jessica Moore
Jessica Moore Vice President, Investor Relations
Slide 18: 4th Quarter 2022 Sales
4th Quarter 2022 Sales % CHANGE Dollars in Billions Regional Sales Results Q4 2022 Q4 2021 Reported Operational1 U.S. $12.5 $12.2 2.9% 2.9% Europe 5.8 6.9 (16.0) (6.3) Western Hemisphere 1.5 1.5 5.9 11.8 (ex U.S.) Asia-Pacific, Africa 3.8 4.3 (10.0) 3.1 International 11.2 12.6 (11.5) (1.1) Worldwide
Slide 19: 4th Quarter 2022 Financial Highlights
4th Quarter 2022 Financial Highlights Dollars in Billions, except EPS Reported %; Operational %1 Sales GAAP Earnings GAAP EPS $24.8 $23.7 $4.7 $1.77 $3.5 $1.33 Q4 2022 Q4 2021 Q4 2022 Q4 2021 Q4 2022 Q4 2021 (4.4)%; 0.9%1 (25.7)% (24.9)% Adjusted Earnings2 Adjusted EPS2 $6.2 $2.35 $5.7 $2.13 Q4 2022
Slide 20: Full Year 2022 Sales
Full Year 2022 Sales % CHANGE Dollars in Billions Regional Sales Results 2022 2021 Reported Operational1 U.S. $48.6 $47.2 3.0% 3.0% Europe 23.4 23.6 (0.6) 11.0 Western Hemisphere 6.1 5.8 6.5 10.2 (ex U.S.) Asia-Pacific, Africa 16.8 17.3 (2.8) 6.2 International 46.4 46.6 (0.6) 9.1 Worldwide (WW) $94.
Slide 21: Full Year 2022 Financial Highlights
Full Year 2022 Financial Highlights Dollars in Billions, except EPS Reported %; Operational %1 Sales GAAP Earnings GAAP EPS $94.9 $93.8 $20.9 $7.81 $17.9 $6.73 2022 2021 2022 2021 2022 2021 1.3%; 6.1%1 (14.1)% (13.8)% Adjusted Earnings2 Adjusted EPS2 $27.0 $26.2 $10.15 $9.80 2022 2021 2022 2021 3.2%
Slide 22: Consumer Health Highlights – 4th Quarter 2022
Consumer Health Highlights – 4th Quarter 2022 Operational growth1 driven by OTC and U.S. Skin Health / Beauty Reported3: WW 1.0%, U.S. 10.9%, Int’l (5.8)% Key Drivers of Operational Performance1,3 Operational1,3: WW 6.4%, U.S. 10.9%, Int’l 3.2% • Growth driven by price actions primarily in the U.S.,
Slide 23: Pharmaceutical Highlights – 4th Quarter 2022
Pharmaceutical Highlights – 4th Quarter 2022 Excluding COVID-19 Vaccine, solid operational growth1 driven by key brands Reported3: WW (7.4)%, U.S. (0.6)%, Int’l (14.9)% Key Drivers of Operational Performance1,3 • STELARA increase driven by market and share growth in both CD and UC, as Operational1,3
Slide 24: MedTech Highlights – 4th Quarter 2022
MedTech Highlights – 4th Quarter 2022 Operational growth1 driven by market recovery and innovation partially offset by impacts in China Reported: WW (1.2)%, U.S. 7.1%, Int’l (8.6)% Key Drivers of Operational Performance1 • Electrophysiology: Double digit increase driven by market growth, new product
Slide 25: Condensed Consolidated Statement of Earnings
Condensed Consolidated Statement of Earnings 4th Quarter 2022 2022 2021 % (Unaudited; Dollar and Shares in Millions Except Per Share Figures) Increase Amount % to Sales Amount % to Sales (Decrease) Sales to customers $23,706 100.0 $24,804 100.0 (4.4) Cost of products sold 7,765 32.8 7,955 32.1 (2.4)
Slide 26: Adjusted Income Before Tax by Segment
Adjusted Income Before Tax by Segment1 4th Quarter 2022 % to Sales $7.4B Q4 2022 Q4 2021 $6.3B Pharmaceutical3 38.2% 33.9% MedTech 25.3% 18.1% $5.0 $4.8 Consumer Health3 22.0% 18.6% Total 31.3% 25.6% $1.7 Pharmaceutical $1.2 MedTech $0.8 $0.7 Consumer Health ($0.2) ($0.4) Expenses Not Allocated to S
Slide 27: Joseph J. Wolk
Joseph J. Wolk Executive Vice President, Chief Financial Officer
Slide 28: Notable Announcements in 4th Quarter 2022
1 Notable Announcements in 4th Quarter 2022 Pharmaceutical • Regulatory: – U.S. FDA Approves TECVAYLI (teclistamab-cqyv), the First Bispecific T-cell Engager Antibody for the Treatment of Patients with Relapsed or Refractory Multiple Myeloma – Janssen Submits Biologics License Application to U.S. FD
Slide 29: Capital Allocation Strategy
Capital Allocation Strategy Dollars in Billions Q4 2022 Cash and Marketable Capital Allocation $24 Securities HIGHER PRIORITY Debt ($40) Organic growth business needs Net Debt ($16) Free cash flow1 Free Cash Flow1,2 ~$17 Note: values may have been rounded Full Year 2022: Competitive dividends Invest
Slide 30: 2023 P&L Guidance
2023 P&L Guidance January Comments Adjusted Operational Sales1,2,6 3.5% - 4.5% Midpoint of 4.0% $96.9B - $97.9B Operational Sales2,6 Midpoint of $97.4B or 5.0% 4.5% – 5.5% $96.9B - $97.9B Estimated Reported Sales 3,6 No FX impact 4.5% – 5.5% Adjusted Pre-Tax OPEX leverage offset Approximately flat O
Slide 31: 2023 Sales Commentary
2023 Sales Commentary January Adjusted Operational Sales Commentary by Segment • Pharmaceutical: Above market growth driven by key Adjusted Operational Sales1,2,4 3.5% - 4.5% brands and uptake of recently launched products partially offset by LOEs $96.9B - $97.9B Operational Sales2,4 • MedTech: Comp
Slide 32: Anticipated 2023 Milestones Driving Long-Term Value Creation
Anticipated 2023 Milestones Driving Long-Term Value Creation Consumer Health Expect to complete the separation Pharmaceutical MedTech Important launches, approvals Key pipeline program updates and data readouts 32
Slide 33: Q&A
Q&A Joaquin Duato Joseph J. Wolk Jessica Moore Chairman of the Board and Executive Vice President, Vice President, Chief Executive Officer Chief Financial Officer Investor Relations
Slide 34: Appendix
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Slide 35: Consumer Health Highlights – Full Year 2022
Consumer Health Highlights – Full Year 2022 Adjusted operational2 growth driven by OTC Reported3: WW (0.5)%, U.S. 1.3%, Int’l (1.9)% Key Drivers of Operational Performance1,3 Operational1,3: WW 3.6%, U.S. 1.3%, Int’l 5.3% • Growth driven by increased Cough/Cold/Flu, adult and pediatric incidences, p
Slide 36: Pharmaceutical Highlights – Full Year 2022
Pharmaceutical Highlights – Full Year 2022 11th consecutive year of above-market performance driven by double-digit growth in key products Reported3: WW 1.7%, U.S. 2.3%, Int’l 1.0% Key Drivers of Operational Performance1,3 Operational1,3: WW 6.7%, U.S. 2.3%, Int’l 11.9% • Growth driven by continued
Slide 37: MedTech Highlights – Full Year 2022
MedTech Highlights – Full Year 2022 Growth primarily driven by market recovery, commercial initiatives and innovation Key Drivers of Operational Performance1 Reported: WW 1.4%, U.S. 5.4%, Int’l (2.3)% Interventional • Electrophysiology: Market recovery, success of new products (VIZIGO and CARTO V7),
Slide 38: Condensed Consolidated Statement of Earnings
Condensed Consolidated Statement of Earnings Full Year 2022 2022 2021 % (Unaudited; Dollar and Shares in Millions Except Per Share Figures) Increase Amount % to Sales Amount % to Sales (Decrease) Sales to customers $94,943 100.0 $93,775 100.0 1.3 Cost of products sold 31,089 32.7 29,855 31.8 4.1 Gro
Slide 39: Adjusted Income Before Tax by Segment
Adjusted Income Before Tax by Segment1 Full Year 2022 % to Sales $31.9B FY 2022 FY 2021 $30.5B Pharmaceutical3 41.5% 40.4% MedTech 26.1% 25.7% $21.8 Consumer Health3 23.6% 24.5% $20.9 Total 33.6% 32.5% Pharmaceutical $7.2 $7.0 MedTech Consumer Health $3.5 $3.7 ($0.6) ($1.1) Expenses Not Allocated to
Slide 40: Pharmaceutical Pipeline — Key Events in 2023
Pharmaceutical Pipeline — Key Events in 2023* POTENTIAL APPROVALS US/EU PLANNED SUBMISSIONS US/EU POTENTIAL CLINICAL DATA Phase IIT Phase IT niraparib US niraparib IMBRUVICA (ibrutinib) BALVERSA (erdafitinib) EU 14 Prostate cancer metastatic castration- resistant in combination with abiraterone acet