) reported fourth quarter 2013 earnings of $1.81 per share, 17
cents above the Zacks Consensus Estimate and 30.2% above the
year-ago earnings. Higher revenues, the end of the Enbrel profit
share, a lower tax rate and a lower share count contributed to
the year-over-year increase in earnings despite higher R&D
spend. Fourth quarter results included the impact of the Oct 2013
Total revenues increased 13% to $5,011 million in the fourth
quarter of 2013, well above the Zacks Consensus Estimate of
Including one-time items, fourth quarter earnings increased
32% to $1.33 per share.
Full year 2013 revenues increased 8% to $18,676 million,
topping the Zacks Consensus Estimate of $18,279 million. Earnings
increased 17.4% to $7.57 per share, well above the Zacks
Consensus Estimate of $7.38 per share.
The Quarter in Detail
Fourth quarter total product revenues increased 11% from the
year-ago quarter to $4,799 million (U.S.: $3,687 million,
ex-U.S.: $1,112 million) with products like Neulasta, Epogen,
Enbrel, Prolia and Xgeva driving growth.
Revenues of Amgen's erythropoiesis-stimulating agent (ESA)
Aranesp declined 4% from the year-ago quarter to $470 million
(U.S.: $180 million; ex-U.S.: $290 million). Lower demand in the
U.S. due to dose reductions and in Europe due to competition and
price cuts will continue impacting sales in these regions.
Revenues of Amgen's other ESA, Epogen, grew 10% to $525
million, driven by unit demand.
Worldwide revenues of Neulasta and Neupogen increased 8% to
$1,407 million in the fourth quarter.
Enbrel delivered revenues of $1,200 million, up 3% from the
year-ago quarter. Revenues were driven by price increases. The
company has been taking steps to improve Enbrel's performance
which includes optimization of the sales force, higher
direct-to-consumer (DTC) advertising and increased focus on
Fourth quarter 2013 Prolia revenues came in at $236 million,
up 53% from the year-ago quarter. Revenues improved 32.6% on a
sequential basis due to higher segment share in the U.S. and the
EU. Amgen also reported a positive response to the DTC campaign
in the U.S.
Meanwhile, Xgeva delivered fourth quarter 2013 revenues of
$286 million, up 33% from the year-ago quarter. Sales were up
9.6% on a sequential basis.
Sensipar/Mimpara revenues increased 20% from the year-ago
quarter to $307 million due to segment growth and higher
penetration in Europe. Vectibix revenues came in at $102 million
during the quarter, up 12% from the year-ago quarter.
Kyprolis, an Onyx product, posted sales of $73 million, up
While fourth quarter 2013 R&D expenses increased 27% from
the year-ago period, SG&A expenses declined 3%. Investment in
late-stage clinical programs for Kyprolis and evolocumab led to
the increase in R&D spend. Meanwhile, the end of the Enbrel
profit share with
) led to lower SG&A spend.
Amgen did not repurchase any shares during the fourth quarter
with $1.6 billion remaining under its share buyback program.
Amgen expects its share buyback activities to slow down in 2014
and 2015 with a higher focus on increasing dividend
Amgen continues to progress with its pipeline and currently
has 10 molecules in late-stage development with data due by
During 2014, Amgen expects to earn $7.90 - $8.20 per share on
total revenues of $19.2 billion to $19.6 billion. The company
expects operating income to be boosted by $800 million due to the
end of the Enbrel profit-sharing arrangement. The Zacks Consensus
Estimate for earnings and revenues are within the guidance range
at $7.92 per share and $19.4 billion, respectively.
Once again, Amgen impressed with strong results. However, the
company's guidance for 2014 was a tad disappointing. Not only are
estimates towards the lower end of the guidance range, the
revenue guidance provided by the company implies a slower growth
rate. But if we go by Amgen's past record, guidance could well
prove to be conservative - last year too, the company had started
off with a conservative guidance which was increased through the
course of the year.
Meanwhile, we expect 2014 to be a data rich year for the
company as it gears up to present data on several late-stage
candidates. Importantly, Amgen could be in a position to file for
approval of its PSCK9 inhibitor, evolocumab, this year. Investors
will also be focused on the FOCUS data on Kyprolis.
Amgen currently carries a Zacks Rank #3 (Hold). Some
better-ranked stocks in the biotech sector include
Alnylam Pharmaceuticals, Inc.
). While Medivation is a Zacks Rank #1 (Strong Buy) stock,
Alnylam carries a Zacks Rank #2 (Buy).
ALNYLAM PHARMA (ALNY): Free Stock Analysis
AMGEN INC (AMGN): Free Stock Analysis Report
MEDIVATION INC (MDVN): Free Stock Analysis
PFIZER INC (PFE): Free Stock Analysis Report
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