Alcon Reports Second-Quarter 2024 Results with Strong Growth in Implantables and Contact Lenses
Alcon (ALC) reported strong Q2 2024 results with record sales of $2.5 billion, up 3% (6% constant currency). Key highlights include:
- Diluted EPS of $0.45, up 32% (47% cc)
- Core diluted EPS of $0.74, up 7% (15% cc)
- H1 2024 cash from operations of $871 million
- Free cash flow of $667 million, up 253%
Growth was driven by robust demand for innovative products, balanced geographic footprint, and strong execution. Surgical sales increased 3% (6% cc) to $1.4 billion, with strength in international markets. Vision Care sales grew 4% (6% cc) to $1.1 billion, led by contact lenses. The company maintained its 2024 outlook, projecting 7-9% constant currency sales growth and core diluted EPS of $3.00-$3.10.
Alcon (ALC) ha riportato risultati solidi per il secondo trimestre del 2024 con vendite record di $2,5 miliardi, in aumento del 3% (6% a cambi costanti). I punti salienti includono:
- EPS diluito di $0,45, in aumento del 32% (47% cc)
- EPS diluito core di $0,74, in aumento del 7% (15% cc)
- Flusso di cassa operativo del primo semestre 2024 di $871 milioni
- Flusso di cassa libero di $667 milioni, in aumento del 253%
La crescita è stata alimentata da una forte domanda per prodotti innovativi, un'adeguata distribuzione geografica e una forte esecuzione. Le vendite chirurgiche sono aumentate del 3% (6% cc) arrivando a $1,4 miliardi, con buone performance nei mercati internazionali. Le vendite di Vision Care sono cresciute del 4% (6% cc) a $1,1 miliardi, guidate dai loro mesi a contatto. L'azienda ha mantenuto le sue previsioni per il 2024, prevedendo una crescita delle vendite a cambi costanti del 7-9% e un EPS diluito core di $3,00-$3,10.
Alcon (ALC) reportó resultados sólidos en el segundo trimestre de 2024 con ventas récord de $2.5 mil millones, un aumento del 3% (6% en moneda constante). Los puntos destacados incluyen:
- EPS diluido de $0.45, un aumento del 32% (47% cc)
- EPS diluido núcleo de $0.74, un aumento del 7% (15% cc)
- Flujo de efectivo operativo del primer semestre de 2024 de $871 millones
- Flujo de efectivo libre de $667 millones, un incremento del 253%
El crecimiento fue impulsado por una fuerte demanda de productos innovadores, una distribución geográfica equilibrada y una sólida ejecución. Las ventas quirúrgicas aumentaron un 3% (6% cc) a $1.4 mil millones, con fuerza en los mercados internacionales. Las ventas de Cuidado Visual crecieron un 4% (6% cc) a $1.1 mil millones, lideradas por lentes de contacto. La compañía mantuvo su perspectiva para 2024, proyectando un crecimiento de ventas en moneda constante del 7-9% y EPS diluido núcleo de $3.00-$3.10.
Alcon (ALC)은 2024년 2분기 강력한 실적을 발표했으며, 25억 달러의 기록적인 판매를 달성했으며, 이는 3% 증가한 수치입니다(상수환율 기준 6% 증가). 주요 하이라이트는 다음과 같습니다:
- 희석 주당순이익(EPS) 0.45달러, 32% 증가 (47% cc)
- 핵심 희석 주당순이익 0.74달러, 7% 증가 (15% cc)
- 2024년 상반기 운영현금흐름 8억 7,100만 달러
- 자유현금흐름 6억 6,700만 달러, 253% 증가
성장은 혁신적인 제품에 대한 강한 수요, 균형 잡힌 지리적 분포 및 강력한 실행력에 의해 촉진되었습니다. 외과 판매는 3% 증가(6% cc)하여 14억 달러에 달했으며, 국제 시장에서의 강세가 있었습니다. 비전 케어 제품 판매는 4% 증가(6% cc)하여 11억 달러에 이르렀으며, 이는 콘택트 렌즈에 의해 주도되었습니다. 이 회사는 2024년도 전망을 유지하며, 상수환율 기준으로 7-9%의 매출 성장과 3.00-3.10달러의 핵심 희석 주당순이익을 예상하고 있습니다.
Alcon (ALC) a annoncé de solides résultats pour le deuxième trimestre 2024 avec des ventes record de 2,5 milliards de dollars, en hausse de 3 % (6 % à taux de change constant). Les points forts incluent :
- Bénéfice par action dilué de 0,45 $, en hausse de 32 % (47 % à taux de change constant)
- Bénéfice par action dilué core de 0,74 $, en hausse de 7 % (15 % à taux de change constant)
- Flux de trésorerie des opérations du premier semestre 2024 de 871 millions de dollars
- Flux de trésorerie libre de 667 millions de dollars, en hausse de 253 %
La croissance a été soutenue par une forte demande pour des produits innovants, une présence géographique équilibrée et une exécution solide. Les ventes chirurgicales ont augmenté de 3 % (6 % à taux de change constant) pour atteindre 1,4 milliard de dollars, avec une bonne performance sur les marchés internationaux. Les ventes de Vision Care ont augmenté de 4 % (6 % à taux de change constant) pour atteindre 1,1 milliard de dollars, soutenues par les lentilles de contact. L'entreprise a maintenu ses prévisions pour 2024, s'attendant à une croissance des ventes à taux de change constant de 7 à 9 % et à un bénéfice par action dilué core de 3,00 à 3,10 $.
Alcon (ALC) berichtete von starken Ergebnissen im zweiten Quartal 2024 mit Rekordumsätzen von 2,5 Milliarden Dollar, was einem Anstieg von 3 % (6 % zu konstanten Wechselkursen) entspricht. Zu den Höhepunkten gehören:
- Verwässerter Gewinn je Aktie von 0,45 $, ein Anstieg um 32 % (47 % cc)
- Kernverwässerter Gewinn je Aktie von 0,74 $, ein Anstieg um 7 % (15 % cc)
- Cashflow aus dem Geschäftsbetrieb im ersten Halbjahr 2024 von 871 Millionen Dollar
- Freier Cashflow von 667 Millionen Dollar, was einem Anstieg von 253 % entspricht
Das Wachstum wurde durch eine robuste Nachfrage nach innovativen Produkten, einer ausgewogenen geografischen Verteilung und einer starken Umsetzung vorangetrieben. Die chirurgischen Verkäufe stiegen um 3 % (6 % cc) auf 1,4 Milliarden Dollar, mit Stärken auf internationalen Märkten. Die Verkäufe im Bereich Vision Care wuchsen um 4 % (6 % cc) auf 1,1 Milliarden Dollar, angeführt von Kontaktlinsen. Das Unternehmen bekräftigte seine Prognose für 2024 und erwartet ein Umsatzwachstum in konstanten Wechselkursen von 7–9 % und einen kernverwässerten Gewinn je Aktie von 3,00–3,10 $.
- Record Q2 sales of $2.5 billion, up 3% (6% constant currency)
- Diluted EPS increased 32% to $0.45
- Core diluted EPS up 7% to $0.74
- Free cash flow of $667 million, up 253%
- Surgical sales grew 3% (6% cc) to $1.4 billion
- Vision Care sales increased 4% (6% cc) to $1.1 billion
- Contact lenses sales up 7% (9% cc)
- Maintained 2024 outlook with 7-9% cc sales growth projected
- Equipment/other sales decreased 3% (-1% cc)
- Ocular health sales declined 1% (up 2% cc)
- Higher inventory provisions in Vision Care due to supplier-related quality issue ($30 million impact)
- Higher costs of inventory in Surgical segment
Insights
Alcon's Q2 2024 results demonstrate solid financial performance, with sales reaching $2.5 billion, up
Notably, Alcon's free cash flow surged to $667 million, a remarkable
The company maintained its full-year 2024 outlook, projecting sales growth of 7-9% in constant currency and core diluted EPS growth of 15-18%. This guidance indicates management's confidence in sustaining growth momentum despite potential macroeconomic challenges.
Alcon's product pipeline shows promising developments. The FDA clearance of Unity VCS/CS represents a significant milestone, potentially expanding Alcon's market presence in vision correction solutions. Additionally, the PDUFA date of May 30th, 2025 for AR-15512 indicates progress in the company's dry eye disease treatment portfolio.
The strong performance in implantables, up 9% in constant currency, highlights Alcon's success in advanced technology intraocular lenses, particularly in international markets. This growth suggests increasing adoption of premium eye care solutions globally.
However, the supplier-related quality issue in Vision Care resulting in higher inventory provisions is a concern. It underscores the importance of robust quality control and supply chain management in the medical device industry.
Alcon's Q2 results reveal a balanced geographic performance, with notable strength in international markets for both Surgical and Vision Care segments. This global diversification helps mitigate regional economic risks and capitalize on emerging market opportunities.
The contact lenses segment's 9% constant currency growth is particularly impressive, driven by innovation in toric and multifocal modalities. This outperformance suggests Alcon is gaining market share in a competitive landscape.
Looking ahead, Alcon's focus on preparing for product launches positions the company for potential accelerated growth in 2025 and beyond. However, investors should monitor the impact of currency fluctuations, as they have negatively affected reported results in several areas.
-
Record Q2 2024 sales of
$2.5 billion 3% , or6% constant currency1 (cc) -
Q2 2024 diluted EPS of
$0.45 32% , or47% cc; core diluted EPS2 of$0.74 7% , or15% cc -
H1 2024 cash from operations of
$871 million $667 million $478 million 253% -
Received
U.S. FDA clearance of Unity VCS/CS and PDUFA date for AR-15512 of May 30th, 2025
Ad Hoc Announcement Pursuant to Art. 53 LR
"We are pleased with our solid second-quarter results, which were driven by robust demand for our innovative products, our balanced geographic footprint and strong execution by our team. These factors contributed to another quarter of sales and earnings growth and robust cash generation," said David J. Endicott, Alcon's Chief Executive Officer. "As we look to the second half of the year, our focus will be on preparing for product launches that will position us well for our next phase of growth in 2025 and beyond."
Second-quarter and first-half 2024 key figures |
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Three months ended June 30 |
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Six months ended June 30 |
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2024 |
|
2023 |
|
2024 |
|
2023 |
Net sales ($ millions) |
|
2,482 |
|
2,402 |
|
4,926 |
|
4,735 |
Operating margin (%) |
|
|
|
|
|
|
|
|
Diluted earnings per share ($) |
|
0.45 |
|
0.34 |
|
0.95 |
|
0.69 |
Core results (non-IFRS measure)2 |
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|
|
|
|
|
|
|
Core operating margin (%) |
|
|
|
|
|
|
|
|
Core diluted earnings per share ($) |
|
0.74 |
|
0.69 |
|
1.52 |
|
1.39 |
Cash flows ($ millions) |
|
|
|
|
|
|
|
|
Net cash flows from operating activities |
|
|
|
|
|
871 |
|
410 |
Free cash flow (non-IFRS measure)3 |
|
|
|
|
|
667 |
|
189 |
1. |
Constant currency is a non-IFRS measure. Refer to the 'Footnotes' section for additional information. |
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2. |
Core results, such as core operating income, core operating margin and core diluted EPS, are non-IFRS measures. Refer to the 'Footnotes' section for additional information. |
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3. |
Free cash flow is a non-IFRS measure. Refer to the 'Footnotes' section for additional information. |
Second-quarter and first-half 2024 results
Sales for the second quarter of 2024 were
The following table highlights net sales by segment for the second quarter and first half of 2024:
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Three months ended
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Change % |
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Six months ended
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Change % |
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($ millions unless indicated
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2024 |
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2023 |
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$ |
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cc1
(non-IFRS
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2024 |
|
2023 |
|
$ |
|
cc1
(non-IFRS
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||
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|
|
|
|
|
|
|
|
|
|
|
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|
|
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|
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Surgical |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Implantables |
|
464 |
|
437 |
|
6 |
|
|
9 |
|
|
897 |
|
864 |
|
4 |
|
|
8 |
Consumables |
|
736 |
|
714 |
|
3 |
|
|
5 |
|
|
1,422 |
|
1,370 |
|
4 |
|
|
6 |
Equipment/other |
|
223 |
|
231 |
|
(3 |
) |
|
(1 |
) |
|
442 |
|
452 |
|
(2 |
) |
|
— |
Total Surgical |
|
1,423 |
|
1,382 |
|
3 |
|
|
6 |
|
|
2,761 |
|
2,686 |
|
3 |
|
|
6 |
Vision Care |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Contact lenses |
|
636 |
|
594 |
|
7 |
|
|
9 |
|
|
1,307 |
|
1,209 |
|
8 |
|
|
10 |
Ocular health |
|
423 |
|
426 |
|
(1 |
) |
|
2 |
|
|
858 |
|
840 |
|
2 |
|
|
5 |
Total Vision Care |
|
1,059 |
|
1,020 |
|
4 |
|
|
6 |
|
|
2,165 |
|
2,049 |
|
6 |
|
|
8 |
Net sales to third parties |
|
2,482 |
|
2,402 |
|
3 |
|
|
6 |
|
|
4,926 |
|
4,735 |
|
4 |
|
|
7 |
Surgical growth reflects strength in international markets
For the second quarter of 2024, Surgical net sales, which include implantables, consumables and equipment/other, were
-
Implantables net sales were
$464 million 6% . Excluding unfavorable currency impacts of3% , implantables net sales increased9% in constant currency. Growth was led by advanced technology intraocular lenses in international markets. -
Consumables net sales were
$736 million 3% , driven by cataract and vitreoretinal consumables, particularly in international markets, and price increases. Excluding unfavorable currency impacts of2% , consumables net sales increased5% constant currency. -
Equipment/other net sales were
$223 million 3% . Excluding unfavorable currency impacts of2% , equipment/other net sales decreased1% constant currency as the prior year period benefited from strong demand for cataract equipment in international markets.
For the first half of 2024, Surgical net sales were
Vision Care growth reflects strength in contact lenses
For the second quarter of 2024, Vision Care net sales, which include contact lenses and ocular health, were
-
Contact lenses net sales were
$636 million 7% , driven by product innovation, including our toric and multifocal modalities, and price increases. Growth was partially offset by unfavorable currency impacts of2% . Contact lenses net sales increased9% constant currency. -
Ocular health net sales were
$423 million 1% . Excluding unfavorable currency impacts of3% , ocular health net sales increased2% in constant currency. This constant currency growth was primarily driven by the portfolio of eye drops, including continued strength from the Systane family of artificial tears. Growth was partially offset by a decline of4% due to contact lens care, primarily driven by the prior year period benefit from the recovery from supply chain challenges.
For the first half of 2024, Vision Care net sales were
Operating income
Second-quarter 2024 operating income was
Adjustments to arrive at core operating income2 in the current year period were
Second-quarter 2024 core operating margin was
First-half 2024 operating income was
First-half 2024 core operating margin was
Diluted earnings per share (EPS)
Second-quarter 2024 diluted earnings per share of
First-half 2024 diluted earnings per share of
Cash flow highlights
The Company ended the first six months of 2024 with a cash position of
Free cash flow was an inflow of
2024 outlook
The Company updated its 2024 outlook as per the table below.
2024 outlook4 |
as of February |
as of May |
as of August |
Comments |
Net sales (USD) |
|
|
|
Maintain |
Change vs. prior year (cc)1
|
+ |
+ |
+ |
Maintain |
Core operating margin2
|
|
|
|
Maintain |
Interest expense and
|
|
|
|
Decrease |
Core effective tax rate5
|
~ |
~ |
~ |
Maintain |
Core diluted EPS2
|
|
|
|
Maintain |
Change vs. prior year (cc)1
|
+ |
+ |
+ |
Maintain |
This outlook assumes the following:
- Aggregated markets grow in line with historical averages (mid-single digits);
- Exchange rates as of the end of July 2024 prevail through year-end;
- Approximately 498 million weighted-averaged diluted shares.
4. |
The forward-looking guidance included in this press release cannot be reconciled to the comparable IFRS measures without unreasonable effort, because we are not able to predict with reasonable certainty the ultimate amount or nature of exceptional items in the fiscal year. Refer to the 'Footnotes' section for additional information. |
|
5. |
Core effective tax rate, a non-IFRS measure, is the applicable annual tax rate on core taxable income. Refer to the 'Footnotes' section for additional information. |
Executive Committee Changes
The Company has made the following changes to its Executive Committee (ECA), which will take effect September 1, 2024:
Ian Bell, currently President, Global Business & Innovation, and a member of the ECA, is named Senior Vice President and Chief Operating Officer (COO). Sue-Jean Lin, currently Senior Vice President, Chief Information and Transformation Officer, will step down from the ECA ahead of her retirement from the Company. Kim Martin, currently Senior Vice President, Chief Human Resources Officer and Corporate Communications, will join the ECA.
Webcast and Conference Call Instructions
The Company will host a conference call on August 21, 2024 at 8:00 a.m. Eastern Daylight Time / 2:00 p.m. Central European Summer Time to discuss its second-quarter 2024 earnings results. The webcast can be accessed online through Alcon's Investor Relations website, investor.alcon.com. Listeners should log on approximately 10 minutes in advance. A replay will be available online within 24 hours after the event.
The Company's interim financial report and supplemental presentation materials can be found online through Alcon's Investor Relations website, or by clicking on the link:
Footnotes (pages 1-4)
- Constant currency (cc) is a non-IFRS measure. Growth in constant currency (cc) is calculated by translating the current year’s foreign currency items into US dollars using average exchange rates from the historical comparative period and comparing them to the values from the historical comparative period in US dollars. An explanation of non-IFRS measures can be found in the 'Non-IFRS measures as defined by the Company' section.
- Core results, such as core operating income, core operating margin and core EPS, are non-IFRS measures. For additional information, including a reconciliation of such core results to the most directly comparable measures presented in accordance with IFRS, see the explanation of non-IFRS measures and reconciliation tables in the 'Non-IFRS measures as defined by the Company' and 'Financial tables' sections.
- Free cash flow is a non-IFRS measure. For additional information regarding free cash flow, see the explanation of non-IFRS measures and reconciliation tables in the 'Non-IFRS measures as defined by the Company' and 'Financial tables' sections.
- The forward-looking guidance included in this press release cannot be reconciled to the comparable IFRS measures without unreasonable efforts, because we are not able to predict with reasonable certainty the ultimate amount or nature of exceptional items in the fiscal year. Refer to the section 'Non-IFRS measures as defined by the Company' for more information.
- Core effective tax rate, a non-IFRS measure, is the applicable annual tax rate on core taxable income. For additional information, see the explanation regarding reconciliation of forward-looking guidance in the 'Non-IFRS measures as defined by the Company' section.
Cautionary Note Regarding Forward-Looking Statements
This document contains, and our officers and representatives may from time to time make, certain “forward-looking statements” within the meaning of the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipate,” “intend,” “commitment,” “look forward,” “maintain,” “plan,” “goal,” “seek,” “target,” “assume,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding our liquidity, revenue, gross margin, operating margin, effective tax rate, foreign currency exchange movements, earnings per share, our plans and decisions relating to various capital expenditures, capital allocation priorities and other discretionary items such as our market growth assumptions, our social impact and sustainability plans, targets, goals and expectations, and generally, our expectations concerning our future performance.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties and risks that are difficult to predict such as: cybersecurity breaches or other disruptions of our information technology systems; compliance with data privacy, identity protection and information security laws, particularly with the increased use of artificial intelligence; the impact of a disruption in our global supply chain or important facilities, particularly when we single-source or rely on limited sources of supply; our ability to forecast sales demand and manage our inventory levels and the changing buying patterns of our customers; our ability to manage social impact and sustainability matters; our reliance on outsourcing key business functions; global and regional economic, financial, monetary, legal, tax, political and social change; our success in completing and integrating strategic acquisitions; the success of our research and development efforts, including our ability to innovate to compete effectively; our ability to comply with the US Foreign Corrupt Practices Act of 1977 and other applicable anti-corruption laws; pricing pressure from changes in third party payor coverage and reimbursement methodologies; our ability to properly educate and train healthcare providers on our products; our ability to protect our intellectual property; our ability to comply with all laws to which we may be subject; the ability to obtain regulatory clearance and approval of our products as well as compliance with any post-approval obligations, including quality control of our manufacturing; the effect of product recalls or voluntary market withdrawals; the accuracy of our accounting estimates and assumptions, including pension and other post-employment benefit plan obligations and the carrying value of intangible assets; the impact of unauthorized importation of our products from countries with lower prices to countries with higher prices; our ability to service our debt obligations; the need for additional financing through the issuance of debt or equity; the effects of litigation, including product liability lawsuits and governmental investigations; supply constraints and increases in the cost of energy; our ability to attract and retain qualified personnel; legislative, tax and regulatory reform; the impact of being listed on two stock exchanges; the ability to declare and pay dividends; the different rights afforded to our shareholders as a Swiss corporation compared to a US corporation; the effect of maintaining or losing our foreign private issuer status under US securities laws; and the ability to enforce US judgments against Swiss corporations.
Additional factors are discussed in our filings with the United States Securities and Exchange Commission, including our Form 20-F. Should one or more of these uncertainties or risks materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements in this document speak only as of the date of its filing, and we assume no obligation to update forward-looking statements as a result of new information, future events or otherwise.
Intellectual Property
This report may contain references to our proprietary intellectual property. All product names appearing in italics or ALL CAPS are trademarks owned by or licensed to Alcon Inc. Product names identified by a "®" or a "™" are trademarks that are not owned by or licensed to Alcon or its subsidiaries and are the property of their respective owners.
Non-IFRS measures as defined by the Company
Alcon uses certain non-IFRS metrics when measuring performance, including when measuring current period results against prior periods, including core results, percentage changes measured in constant currency and free cash flow.
Because of their non-standardized definitions, the non-IFRS measures (unlike IFRS measures) may not be comparable to the calculation of similar measures of other companies. These supplemental non-IFRS measures are presented solely to permit investors to more fully understand how Alcon management assesses underlying performance. These supplemental non-IFRS measures are not, and should not be viewed as, a substitute for IFRS measures.
Core results
Alcon core results, including core operating income and core net income, exclude all amortization and impairment charges of intangible assets, excluding software, net gains and losses on fund investments and equity securities valued at fair value through profit and loss ("FVPL"), fair value adjustments of financial assets in the form of options to acquire a company carried at FVPL and certain acquisition related items. The following items that exceed a threshold of
Taxes on the adjustments between IFRS and core results take into account, for each individual item included in the adjustment, the tax rate that will finally be applicable to the item based on the jurisdiction where the adjustment will finally have a tax impact. Generally, this results in amortization and impairment of intangible assets and acquisition-related restructuring and integration items having a full tax impact. There is usually a tax impact on other items, although this is not always the case for items arising from legal settlements in certain jurisdictions.
Alcon believes that investor understanding of its performance is enhanced by disclosing core measures of performance because, since they exclude items that can vary significantly from period to period, the core measures enable a helpful comparison of business performance across periods. For this same reason, Alcon uses these core measures in addition to IFRS and other measures as important factors in assessing its performance.
A limitation of the core measures is that they provide a view of Alcon operations without including all events during a period, such as the effects of an acquisition, divestment, or amortization/impairments of purchased intangible assets and restructurings.
Constant currency
Changes in the relative values of non-US currencies to the US dollar can affect Alcon's financial results and financial position. To provide additional information that may be useful to investors, including changes in sales volume, we present information about changes in our net sales and various values relating to operating and net income that are adjusted for such foreign currency effects.
Constant currency calculations have the goal of eliminating two exchange rate effects so that an estimate can be made of underlying changes in the Consolidated Income Statement excluding:
- the impact of translating the income statements of consolidated entities from their non-US dollar functional currencies to the US dollar; and
- the impact of exchange rate movements on the major transactions of consolidated entities performed in currencies other than their functional currency.
Alcon calculates constant currency measures by translating the current year's foreign currency values for sales and other income statement items into US dollars, using the average exchange rates from the historical comparative period and comparing them to the values from the historical comparative period in US dollars.
Free cash flow
Alcon defines free cash flow as net cash flows from operating activities less cash flow associated with the purchase or sale of property, plant and equipment. Free cash flow is presented as additional information because Alcon management believes it is a useful supplemental indicator of Alcon's ability to operate without reliance on additional borrowing or use of existing cash. Free cash flow is not intended to be a substitute measure for net cash flows from operating activities as determined under IFRS.
Growth rate and margin calculations
For ease of understanding, Alcon uses a sign convention for its growth rates such that a reduction in operating expenses or losses compared to the prior year is shown as a positive growth.
Gross margins, operating income margins and core operating income margins are calculated based upon net sales to third parties unless otherwise noted.
Reconciliation of guidance for forward-looking non-IFRS measures
The forward-looking guidance included in this press release cannot be reconciled to the comparable IFRS measures without unreasonable efforts, because we are not able to predict with reasonable certainty the ultimate amount or nature of exceptional items in the fiscal year. These items are uncertain, depend on many factors and could have a material impact on our IFRS results for the guidance period.
Financial tables
Net sales by region
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|
Three months ended June 30 |
|
Six months ended June 30 |
||||||||
($ millions unless indicated otherwise) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,141 |
|
|
1,105 |
|
|
2,290 |
|
|
2,183 |
|
International |
|
1,341 |
|
|
1,297 |
|
|
2,636 |
|
|
2,552 |
|
Net sales to third parties |
|
2,482 |
|
|
2,402 |
|
|
4,926 |
|
|
4,735 |
|
Consolidated Income Statement (unaudited)
|
|
Three months ended June 30 |
|
Six months ended June 30 |
||||||
($ millions except earnings per share) |
|
2024 |
|
2023 |
|
|
2024 |
|
2023 |
|
Net sales to third parties |
|
2,482 |
|
2,402 |
|
|
4,926 |
|
4,735 |
|
Other revenues |
|
14 |
|
20 |
|
|
29 |
|
39 |
|
Net sales and other revenues |
|
2,496 |
|
2,422 |
|
|
4,955 |
|
4,774 |
|
Cost of net sales |
|
(1,108 |
) |
(1,040 |
) |
|
(2,171 |
) |
(2,070 |
) |
Cost of other revenues |
|
(14 |
) |
(19 |
) |
|
(28 |
) |
(36 |
) |
Gross profit |
|
1,374 |
|
1,363 |
|
|
2,756 |
|
2,668 |
|
Selling, general & administration |
|
(837 |
) |
(832 |
) |
|
(1,639 |
) |
(1,617 |
) |
Research & development |
|
(220 |
) |
(217 |
) |
|
(419 |
) |
(419 |
) |
Other income |
|
5 |
|
5 |
|
|
11 |
|
10 |
|
Other expense |
|
(4 |
) |
(49 |
) |
|
(23 |
) |
(104 |
) |
Operating income |
|
318 |
|
270 |
|
|
686 |
|
538 |
|
Interest expense |
|
(50 |
) |
(48 |
) |
|
(95 |
) |
(95 |
) |
Other financial income & expense |
|
12 |
|
(9 |
) |
|
24 |
|
(17 |
) |
Income before taxes |
|
280 |
|
213 |
|
|
615 |
|
426 |
|
Taxes |
|
(57 |
) |
(44 |
) |
|
(144 |
) |
(83 |
) |
Net income |
|
223 |
|
169 |
|
|
471 |
|
343 |
|
|
|
|
|
|
|
|
||||
Earnings per share ($) |
||||||||||
Basic |
|
0.45 |
|
0.34 |
|
|
0.95 |
|
0.70 |
|
Diluted |
|
0.45 |
|
0.34 |
|
|
0.95 |
|
0.69 |
|
|
|
|
|
|
|
|
||||
Weighted average number of shares outstanding (millions) |
||||||||||
Basic |
|
494.5 |
|
493.2 |
|
|
494.1 |
|
492.8 |
|
Diluted |
|
497.0 |
|
495.7 |
|
|
496.7 |
|
495.9 |
|
Balance sheet highlights
($ millions) |
|
June 30, 2024 |
|
December 31, 2023 |
Cash and cash equivalents |
|
1,372 |
|
1,094 |
Current financial debts |
|
137 |
|
63 |
Non-current financial debts |
|
4,550 |
|
4,676 |
Free cash flow (non-IFRS measure)
The following is a summary of free cash flow for the six months ended June 30, 2024 and 2023, together with a reconciliation to net cash flows from operating activities, the most directly comparable IFRS measure:
|
Six months ended June 30 |
||||
($ millions) |
2024 |
|
|
2023 |
|
Net cash flows from operating activities |
871 |
|
|
410 |
|
Purchase of property, plant & equipment |
(204 |
) |
|
(221 |
) |
Free cash flow |
667 |
|
|
189 |
|
Reconciliation of IFRS results to core results (non-IFRS measure)
Three months ended June 30, 2024
($ millions except earnings per share) |
IFRS
|
Amortization of
|
Impairments(2) |
Other
|
Core results
(non-IFRS
|
||||
Gross profit |
1,374 |
|
165 |
|
— |
— |
|
1,539 |
|
Operating income |
318 |
|
165 |
|
9 |
(1 |
) |
491 |
|
Income before taxes |
280 |
|
165 |
|
9 |
(1 |
) |
453 |
|
Taxes(5) |
(57 |
) |
(30 |
) |
— |
1 |
|
(86 |
) |
Net income |
223 |
|
135 |
|
9 |
— |
|
367 |
|
Basic earnings per share ($) |
0.45 |
|
|
|
|
0.74 |
|
||
Diluted earnings per share ($) |
0.45 |
|
|
|
|
0.74 |
|
||
Basic - weighted average shares outstanding (millions)(6) |
494.5 |
|
|
|
|
494.5 |
|
||
Diluted - weighted average shares outstanding (millions)(6) |
497.0 |
|
|
|
|
497.0 |
|
||
Refer to the associated explanatory footnotes at the end of the 'Reconciliation of IFRS results to core results (non-IFRS measure)' tables.
Three months ended June 30, 2023
($ millions except earnings per share) |
IFRS results |
Amortization of
|
Transformation
|
Other
|
Core results
|
|||||
Gross profit |
1,363 |
|
164 |
|
— |
|
5 |
|
1,532 |
|
Operating income |
270 |
|
168 |
|
26 |
|
15 |
|
479 |
|
Income before taxes |
213 |
|
168 |
|
26 |
|
15 |
|
422 |
|
Taxes(5) |
(44 |
) |
(30 |
) |
(4 |
) |
(3 |
) |
(81 |
) |
Net income |
169 |
|
138 |
|
22 |
|
12 |
|
341 |
|
Basic earnings per share ($) |
0.34 |
|
|
|
|
0.69 |
|
|||
Diluted earnings per share ($) |
0.34 |
|
|
|
|
0.69 |
|
|||
Basic - weighted average shares outstanding (millions)(6) |
493.2 |
|
|
|
|
493.2 |
|
|||
Diluted - weighted average shares outstanding (millions)(6) |
495.7 |
|
|
|
|
495.7 |
|
|||
Refer to the associated explanatory footnotes at the end of the 'Reconciliation of IFRS results to core results (non-IFRS measure)' tables.
Six months ended June 30, 2024
($ millions except earnings per share) |
IFRS results |
Amortization of
|
Impairments(2) |
Other items(4) |
Core results
|
|||
Gross profit |
2,756 |
|
329 |
|
— |
3 |
3,088 |
|
Operating income |
686 |
|
331 |
|
9 |
2 |
1,028 |
|
Income before taxes |
615 |
|
331 |
|
9 |
2 |
957 |
|
Taxes(5) |
(144 |
) |
(59 |
) |
— |
— |
(203 |
) |
Net income |
471 |
|
272 |
|
9 |
2 |
754 |
|
Basic earnings per share ($) |
0.95 |
|
|
|
|
1.53 |
|
|
Diluted earnings per share ($) |
0.95 |
|
|
|
|
1.52 |
|
|
Basic - weighted average shares outstanding (millions)(6) |
494.1 |
|
|
|
|
494.1 |
|
|
Diluted - weighted average shares outstanding (millions)(6) |
496.7 |
|
|
|
|
496.7 |
|
|
Refer to the associated explanatory footnotes at the end of the 'Reconciliation of IFRS results to core results (non-IFRS measure)' tables.
Six months ended June 30, 2023
($ millions except earnings per share) |
IFRS results |
Amortization of
|
Transformation
|
Other
|
Core results
|
|||||
Gross profit |
2,668 |
|
333 |
|
— |
|
9 |
|
3,010 |
|
Operating income |
538 |
|
341 |
|
52 |
|
28 |
|
959 |
|
Income before taxes |
426 |
|
341 |
|
52 |
|
28 |
|
847 |
|
Taxes(5) |
(83 |
) |
(61 |
) |
(9 |
) |
(6 |
) |
(159 |
) |
Net income |
343 |
|
280 |
|
43 |
|
22 |
|
688 |
|
Basic earnings per share ($) |
0.70 |
|
|
|
|
1.40 |
|
|||
Diluted earnings per share ($) |
0.69 |
|
|
|
|
1.39 |
|
|||
Basic - weighted average shares outstanding (millions)(6) |
492.8 |
|
|
|
|
492.8 |
|
|||
Diluted - weighted average shares outstanding (millions)(6) |
495.9 |
|
|
|
|
495.9 |
|
|||
Refer to the associated explanatory footnotes at the end of the 'Reconciliation of IFRS results to core results (non-IFRS measure)' tables.
Explanatory footnotes to IFRS to core reconciliation tables
(1) |
Includes recurring amortization for all intangible assets other than software. |
||
(2) |
Includes impairment charges related to intangible assets. |
||
(3) |
Transformation costs, primarily related to restructuring and third party consulting fees, for the multi-year transformation program. The transformation program was completed in the fourth quarter of 2023. |
||
(4) |
For the three months ended June 30, 2024, Operating income includes fair value adjustments of financial assets, partially offset by the amortization of option rights. |
||
|
For the three months ended June 30, 2023, Gross profit includes the amortization of inventory fair value adjustments related to a recent acquisition. Operating income also includes integration related expenses for a recent acquisition and the amortization of option rights. |
||
|
For the six months ended June 30, 2024, Gross profit includes the amortization of inventory fair value adjustments related to a recent acquisition. Operating income also includes the amortization of option rights, offset by fair value adjustments of financial assets. |
||
|
For the six months ended June 30, 2023, Gross profit includes the amortization of inventory fair value adjustments related to a recent acquisition. Operating income also includes integration related expenses for a recent acquisition, fair value adjustments of financial assets and the amortization of option rights. |
||
(5) |
For the three months ended June 30, 2024, tax associated with operating income core adjustments of |
||
|
For the three months ended June 30, 2023, tax associated with operating income core adjustments of |
||
|
For the six months ended June 30, 2024, tax associated with operating income core adjustments of |
||
|
For the six months ended June 30, 2023, tax associated with operating income core adjustments of |
||
(6) |
Core basic earnings per share is calculated using the weighted-average shares of common stock outstanding during the period. Core diluted earnings per share also contemplate dilutive shares associated with unvested equity-based awards as described in Note 3 to the Condensed Consolidated Interim Financial Statements. |
About Alcon
Alcon helps people see brilliantly. As the global leader in eye care with a heritage spanning over 75 years, we offer the broadest portfolio of products to enhance sight and improve people’s lives. Our Surgical and Vision Care products touch the lives of people in over 140 countries each year living with conditions like cataracts, glaucoma, retinal diseases and refractive errors. Our more than 25,000 associates are enhancing the quality of life through innovative products, partnerships with Eye Care Professionals and programs that advance access to quality eye care. Learn more at www.alcon.com.
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Investor Relations
Daniel Cravens
Allen Trang
+ 41 589 112 110 (
+ 1 817 615 2789 (
investor.relations@alcon.com
Media Relations
Steven Smith
+ 41 589 112 111 (
+ 1 817 551 8057 (
globalmedia.relations@alcon.com
Source: Alcon Inc. Investors
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