Organon Reports Results for the Second Quarter Ended June 30, 2023
- Organon's revenue increased by 1% as-reported and 4% excluding the impact of foreign currency (ex-FX) compared to the second quarter of 2022.
- The Women's Health and Biosimilars franchise revenue grew 10% and 15% ex-FX, respectively, and Established Brands demonstrated stability.
- Adjusted EBITDA margin range is now 31.5%-33.0% to incorporate current visibility on IPR&D and milestones.
- The company's gross margin was 60.2% as-reported and 62.9% on an adjusted basis in the second quarter of 2023.
- Organon's Board of Directors declared a quarterly dividend of $0.28 per share, reflecting confidence in the company's financial position and future cash flows.
- None.
-
Second quarter 2023 revenue of
$1,608 million -
Second quarter 2023 diluted earnings per share of
and non-GAAP Adjusted diluted earnings per share of$0.95 $1.31 -
Adjusted EBITDA of
$530 million -
Board of Directors declares quarterly dividend of
per share$0.28 -
Full year 2023 financial guidance ranges updated:
-
Revenue range narrowed to
to$6.25 billion , primarily reflecting current foreign currency exchange rates$6.45 billion -
Adjusted EBITDA margin range now
31.5% -33.0% to incorporate current visibility on IPR&D (in-process research and development) and milestones
-
Revenue range narrowed to
"During the second quarter of 2023, Organon continued to build on its track record, delivering solid volume growth across all regions and franchises. The Women's Health and Biosimilars franchise revenue grew
Second Quarter 2023 Revenue
in $ millions |
Q2 2023 |
Q2 2022 |
VPY |
VPY ex-FX |
||
Women’s Health |
$ |
438 |
$ |
408 |
|
|
Biosimilars |
|
135 |
|
119 |
|
|
Established Brands |
|
995 |
|
1,018 |
(2)% |
—% |
Other (1) |
|
40 |
|
40 |
(2)% |
(1)% |
Revenues |
$ |
1,608 |
$ |
1,585 |
|
|
(1) Other includes manufacturing sales to Merck & Co., Inc., |
For the second quarter of 2023, total revenue was
Women’s Health revenue increased
Biosimilars revenue increased
Established Brands revenue decreased
Second Quarter 2023 Profitability
in $ millions, except per share amounts |
|
Q2 2023 |
|
Q2 2022 |
|
VPY |
||
Revenues |
|
$ |
1,608 |
|
$ |
1,585 |
|
|
Cost of sales |
|
|
640 |
|
|
588 |
|
|
Gross profit |
|
|
968 |
|
|
997 |
|
(3)% |
Non-GAAP Adjusted gross profit (1) |
|
|
1,012 |
|
|
1,047 |
|
(3)% |
Adjusted EBITDA (1,2) |
|
|
530 |
|
|
512 |
|
|
Net income |
|
|
242 |
|
|
234 |
|
|
Non-GAAP Adjusted net income (1) |
|
|
336 |
|
|
319 |
|
|
Diluted Earnings per Share (EPS) |
|
|
0.95 |
|
|
0.92 |
|
|
Non-GAAP Adjusted diluted EPS (1) |
|
|
1.31 |
|
|
1.25 |
|
|
Acquired in-process research & development (IPR&D) and milestones |
|
|
— |
|
|
97 |
|
NM |
Per share impact to diluted EPS from acquired IPR&D and milestones |
|
|
— |
|
|
(0.30) |
|
NM |
|
|
Q2 2023 |
|
Q2 2022 |
Gross margin |
|
|
|
|
Non-GAAP Adjusted gross margin (1) |
|
|
|
|
Adjusted EBITDA margin (1,2) |
|
|
|
|
(1) See Tables 4 and 5 for reconciliations of GAAP to non-GAAP financial measures |
||||
(2) Adjusted EBITDA and Adjusted EBITDA margin include |
Gross margin was
Adjusted EBITDA margin was
Net income for the second quarter of 2023 was
Capital Allocation
Today, Organon’s Board of Directors declared a quarterly dividend of
As of June 30, 2023, cash and cash equivalents were
Full Year Guidance
Organon does not provide GAAP financial measures on a forward-looking basis because the company cannot predict with reasonable certainty and without unreasonable effort, the ultimate outcome of legal proceedings, unusual gains and losses, the occurrence of matters creating GAAP tax impacts, and acquisition-related expenses. These items are uncertain, depend on various factors, and could be material to Organon’s results computed in accordance with GAAP.
The company is updating its full year 2023 guidance ranges previously provided on May 4, 2023. The range for full year 2023 revenue is narrowed to
Full year 2023 financial guidance is presented below on a non-GAAP basis.
|
Previous guidance as of
|
Current guidance |
Revenues |
|
|
Adjusted gross margin |
Low-mid |
Unchanged |
SG&A (as % of revenue) |
Mid |
Unchanged |
R&D (as % of revenue) |
Upper single-digit |
Unchanged |
Adjusted EBITDA margin |
|
|
Interest |
|
|
Depreciation |
|
|
Effective non-GAAP tax rate |
|
|
Fully diluted weighted average shares outstanding |
~257 million |
Unchanged |
Webcast Information
Organon will host a conference call at 8:30 a.m. Eastern Time today to discuss its second quarter 2023 financial results. To listen to the event and view the presentation slides via webcast, join from the Organon Investor Relations website at https://www.organon.com/investor-relations/events-and-presentations/. A replay of the webcast will be available approximately two hours after the conclusion of the live event on the company’s website. Institutional investors and analysts interested in participating in the call must register in advance by clicking on this link: https://conferencingportals.com/event/jgIqShwa
Following registration, participants will receive a confirmation email containing details on how to join the conference call, including dial-in information and a unique passcode and registrant ID. Pre-registration will allow participants to bypass an operator and be placed directly into the call.
About Organon
Organon is a global healthcare company formed to focus on improving the health of women throughout their lives. Organon offers more than 60 medicines and products in women’s health in addition to a growing biosimilars business and a large franchise of established medicines across a range of therapeutic areas. Organon’s existing products produce strong cash flows that support investments in innovation and future growth opportunities in women’s health and biosimilars. In addition, Organon is pursuing opportunities to collaborate with biopharmaceutical innovators looking to commercialize their products by leveraging its scale and presence in fast growing international markets.
Organon has a global footprint with significant scale and geographic reach, world-class commercial capabilities, and approximately 10,000 employees with headquarters located in
For more information, visit http://www.organon.com and connect with us on LinkedIn, Instagram, Twitter and Facebook.
Cautionary Note Regarding Non-GAAP Financial Measures
This press release contains “non-GAAP financial measures,” which are financial measures that either exclude or include amounts that are correspondingly not excluded or included in the most directly comparable measures calculated and presented in accordance with
In addition, the company’s full-year 2023 guidance measures (other than revenue) are provided on a non-GAAP basis because the company is unable to reasonably predict certain items contained in the GAAP measures. Such items include, but are not limited to, acquisition related expenses, restructuring and related expenses, stock-based compensation, the ultimate outcome of legal proceedings, unusual gains and losses, the occurrence of matters creating GAAP tax impacts and other items not reflective of the company's ongoing operations.
The company uses non-GAAP financial measures in its operational and financial decision making, and believes that it is useful to exclude certain items in order to focus on what it regards to be a more meaningful representation of the underlying operating performance of the business.
Cautionary Note Regarding Forward-Looking Statements
Except for historical information, this press release includes “forward-looking statements” within the meaning of the safe harbor provisions of the
Risks and uncertainties include, but are not limited to, an inability to fully execute on our product development and commercialization plans within
The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the company’s filings with the Securities and Exchange Commission ("SEC"), including the company’s Annual Report on Form 10-K for the year ended December 31, 2022, available at the SEC’s Internet site (www.sec.gov).
TABLE 1
Organon & Co.
|
|||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||
Revenues |
$ |
1,608 |
|
$ |
1,585 |
|
|
$ |
3,146 |
|
$ |
3,152 |
|
Costs, Expenses and Other |
|
|
|
|
|
|
|
||||||
Cost of sales |
|
640 |
|
|
588 |
|
|
|
1,220 |
|
|
1,149 |
|
Selling, general and administrative |
|
451 |
|
|
423 |
|
|
|
886 |
|
|
794 |
|
Research and development |
|
128 |
|
|
106 |
|
|
|
257 |
|
|
202 |
|
Acquired in-process research and development and milestones |
|
— |
|
|
97 |
|
|
|
8 |
|
|
97 |
|
Restructuring costs |
|
— |
|
|
— |
|
|
|
4 |
|
|
— |
|
Interest expense |
|
132 |
|
|
98 |
|
|
|
264 |
|
|
195 |
|
Exchange losses (gains) |
|
2 |
|
|
(21 |
) |
|
|
11 |
|
|
(25 |
) |
Other expense, net |
|
1 |
|
|
7 |
|
|
|
7 |
|
|
11 |
|
|
|
1,354 |
|
|
1,298 |
|
|
|
2,657 |
|
|
2,423 |
|
Income Before Income Taxes |
|
254 |
|
|
287 |
|
|
|
489 |
|
|
729 |
|
Taxes on income |
|
12 |
|
|
53 |
|
|
|
70 |
|
|
147 |
|
Net Income |
|
242 |
|
|
234 |
|
|
|
419 |
|
|
582 |
|
|
|
|
|
|
|
|
|
||||||
Earnings per Share: |
|
|
|
|
|
|
|
||||||
Basic |
$ |
0.95 |
|
$ |
0.92 |
|
|
$ |
1.64 |
|
$ |
2.29 |
|
Diluted |
$ |
0.95 |
|
$ |
0.92 |
|
|
$ |
1.64 |
|
$ |
2.28 |
|
|
|
|
|
|
|
|
|
||||||
Weighted Average Shares Outstanding: |
|
|
|
|
|
|
|
||||||
Basic |
|
255,341 |
|
|
254,018 |
|
|
|
254,869 |
|
|
253,802 |
|
Diluted |
|
255,953 |
|
|
255,156 |
|
|
|
256,064 |
|
|
255,105 |
|
TABLE 2
Organon & Co.
|
||||||||||||||||||||||||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||||||||||||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||||||||||||||||||||||
|
|
|
Int’l |
|
Total |
|
|
|
Int’l |
|
Total |
|
|
|
Int’l |
|
Total |
|
|
|
Int’l |
|
Total |
|||||||||||||
Women’s Health |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Nexplanon/Implanon NXT |
$ |
159 |
|
|
$ |
56 |
|
$ |
214 |
|
$ |
134 |
|
$ |
61 |
|
$ |
195 |
|
$ |
272 |
|
$ |
107 |
|
$ |
380 |
|
$ |
250 |
|
$ |
116 |
|
$ |
366 |
Follistim AQ |
|
26 |
|
|
|
44 |
|
|
70 |
|
|
23 |
|
|
35 |
|
|
58 |
|
|
52 |
|
|
73 |
|
|
125 |
|
|
52 |
|
|
66 |
|
|
119 |
NuvaRing |
|
17 |
|
|
|
23 |
|
|
40 |
|
|
22 |
|
|
20 |
|
|
42 |
|
|
33 |
|
|
47 |
|
|
80 |
|
|
38 |
|
|
45 |
|
|
83 |
Ganirelix Acetate Injection |
|
4 |
|
|
|
29 |
|
|
34 |
|
|
6 |
|
|
25 |
|
|
32 |
|
|
11 |
|
|
53 |
|
|
63 |
|
|
14 |
|
|
47 |
|
|
61 |
Marvelon/Mercilon |
|
— |
|
|
|
29 |
|
|
29 |
|
|
— |
|
|
31 |
|
|
31 |
|
|
— |
|
|
67 |
|
|
67 |
|
|
— |
|
|
54 |
|
|
54 |
Other Women's Health (1) |
|
27 |
|
|
|
25 |
|
|
52 |
|
|
29 |
|
|
22 |
|
|
51 |
|
|
53 |
|
|
52 |
|
|
105 |
|
|
56 |
|
|
47 |
|
|
103 |
Biosimilars |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Renflexis |
|
60 |
|
|
|
11 |
|
|
70 |
|
|
51 |
|
|
8 |
|
|
59 |
|
|
114 |
|
|
18 |
|
|
132 |
|
|
93 |
|
|
12 |
|
|
105 |
Ontruzant |
|
12 |
|
|
|
21 |
|
|
33 |
|
|
12 |
|
|
23 |
|
|
35 |
|
|
25 |
|
|
29 |
|
|
54 |
|
|
19 |
|
|
38 |
|
|
57 |
Brenzys |
|
— |
|
|
|
13 |
|
|
13 |
|
|
— |
|
|
14 |
|
|
14 |
|
|
— |
|
|
32 |
|
|
32 |
|
|
— |
|
|
28 |
|
|
28 |
Aybintio |
|
— |
|
|
|
12 |
|
|
12 |
|
|
— |
|
|
9 |
|
|
9 |
|
|
— |
|
|
22 |
|
|
22 |
|
|
— |
|
|
19 |
|
|
19 |
Hadlima |
|
— |
|
|
|
7 |
|
|
7 |
|
|
— |
|
|
2 |
|
|
2 |
|
|
— |
|
|
12 |
|
|
12 |
|
|
— |
|
|
8 |
|
|
8 |
Established Brands |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cardiovascular |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Zetia |
|
2 |
|
|
|
89 |
|
|
90 |
|
|
2 |
|
|
99 |
|
|
101 |
|
|
4 |
|
|
169 |
|
|
173 |
|
|
5 |
|
|
195 |
|
|
200 |
Vytorin |
|
1 |
|
|
|
37 |
|
|
38 |
|
|
3 |
|
|
32 |
|
|
35 |
|
|
3 |
|
|
65 |
|
|
67 |
|
|
5 |
|
|
68 |
|
|
73 |
Atozet |
|
— |
|
|
|
143 |
|
|
143 |
|
|
— |
|
|
122 |
|
|
122 |
|
|
— |
|
|
271 |
|
|
271 |
|
|
— |
|
|
240 |
|
|
240 |
Rosuzet |
|
— |
|
|
|
17 |
|
|
17 |
|
|
— |
|
|
16 |
|
|
16 |
|
|
— |
|
|
35 |
|
|
35 |
|
|
— |
|
|
38 |
|
|
38 |
Cozaar/Hyzaar |
|
2 |
|
|
|
69 |
|
|
71 |
|
|
2 |
|
|
91 |
|
|
92 |
|
|
4 |
|
|
152 |
|
|
156 |
|
|
10 |
|
|
176 |
|
|
186 |
Other Cardiovascular (1) |
|
1 |
|
|
|
41 |
|
|
41 |
|
|
1 |
|
|
45 |
|
|
46 |
|
|
1 |
|
|
81 |
|
|
82 |
|
|
2 |
|
|
83 |
|
|
85 |
Respiratory |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Singulair |
|
3 |
|
|
|
77 |
|
|
80 |
|
|
3 |
|
|
89 |
|
|
92 |
|
|
5 |
|
|
194 |
|
|
199 |
|
|
5 |
|
|
216 |
|
|
222 |
Nasonex |
|
— |
|
|
|
64 |
|
|
64 |
|
|
— |
|
|
58 |
|
|
58 |
|
|
— |
|
|
133 |
|
|
133 |
|
|
9 |
|
|
123 |
|
|
133 |
Dulera |
|
38 |
|
|
|
10 |
|
|
48 |
|
|
36 |
|
|
12 |
|
|
47 |
|
|
76 |
|
|
18 |
|
|
95 |
|
|
67 |
|
|
21 |
|
|
88 |
Clarinex |
|
1 |
|
|
|
38 |
|
|
39 |
|
|
1 |
|
|
34 |
|
|
35 |
|
|
2 |
|
|
77 |
|
|
79 |
|
|
2 |
|
|
70 |
|
|
73 |
Other Respiratory (1) |
|
13 |
|
|
|
6 |
|
|
19 |
|
|
11 |
|
|
11 |
|
|
22 |
|
|
25 |
|
|
12 |
|
|
37 |
|
|
23 |
|
|
22 |
|
|
45 |
Non-Opioid Pain, Bone and Dermatology |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Arcoxia |
|
— |
|
|
|
72 |
|
|
72 |
|
|
— |
|
|
61 |
|
|
61 |
|
|
— |
|
|
143 |
|
|
143 |
|
|
— |
|
|
121 |
|
|
121 |
Fosamax |
|
1 |
|
|
|
44 |
|
|
44 |
|
|
1 |
|
|
39 |
|
|
40 |
|
|
1 |
|
|
81 |
|
|
82 |
|
|
2 |
|
|
79 |
|
|
81 |
Diprospan |
|
— |
|
|
|
12 |
|
|
12 |
|
|
— |
|
|
31 |
|
|
31 |
|
|
— |
|
|
27 |
|
|
27 |
|
|
— |
|
|
63 |
|
|
63 |
Other Non-Opioid Pain, Bone and Dermatology (1) |
|
2 |
|
|
|
67 |
|
|
71 |
|
|
5 |
|
|
71 |
|
|
76 |
|
|
7 |
|
|
127 |
|
|
133 |
|
|
8 |
|
|
137 |
|
|
145 |
Other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Proscar |
|
— |
|
|
|
24 |
|
|
25 |
|
|
— |
|
|
26 |
|
|
26 |
|
|
1 |
|
|
51 |
|
|
52 |
|
|
1 |
|
|
50 |
|
|
50 |
Propecia |
|
2 |
|
|
|
35 |
|
|
36 |
|
|
2 |
|
|
33 |
|
|
35 |
|
|
4 |
|
|
66 |
|
|
69 |
|
|
3 |
|
|
63 |
|
|
66 |
Other (1) |
|
2 |
|
|
|
81 |
|
|
84 |
|
|
7 |
|
|
74 |
|
|
82 |
|
|
4 |
|
|
156 |
|
|
162 |
|
|
15 |
|
|
149 |
|
|
164 |
Other (2) |
|
(2 |
) |
|
|
41 |
|
|
40 |
|
|
— |
|
|
40 |
|
|
40 |
|
|
— |
|
|
79 |
|
|
79 |
|
|
1 |
|
|
78 |
|
|
76 |
Revenues |
$ |
371 |
|
|
$ |
1,237 |
|
$ |
1,608 |
|
$ |
351 |
|
$ |
1,234 |
|
$ |
1,585 |
|
$ |
697 |
|
$ |
2,449 |
|
$ |
3,146 |
|
$ |
680 |
|
$ |
2,472 |
|
$ |
3,152 |
Totals may not foot due to rounding. Trademarks appearing above in italics are trademarks of, or are used under license by, the Organon group of companies. |
||||||||||||||||||||||||||||||||||||
(1) Includes sales of products not listed separately. Revenues from Marvelon™ and Mercilon™ were previously reported as part of Other Women's Health. Revenue from an arrangement for the sale of generic etonogestrel/ethinyl estradiol vaginal ring is included in Other Women's Health. |
||||||||||||||||||||||||||||||||||||
(2) Other includes manufacturing sales to Merck & Co., Inc., |
TABLE 3
Organon & Co.
|
|||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
$ |
467 |
|
$ |
443 |
|
$ |
867 |
|
$ |
880 |
|
|
371 |
|
|
351 |
|
|
697 |
|
|
680 |
|
|
261 |
|
|
291 |
|
|
585 |
|
|
604 |
|
|
234 |
|
|
244 |
|
|
459 |
|
|
480 |
|
|
234 |
|
|
216 |
|
|
448 |
|
|
425 |
Other (1) |
|
41 |
|
|
40 |
|
|
90 |
|
|
83 |
Revenues |
$ |
1,608 |
|
$ |
1,585 |
|
$ |
3,146 |
|
$ |
3,152 |
(1) Other includes manufacturing sales to Merck & Co., Inc., |
TABLE 4
Reconciliation of GAAP Reported to Non-GAAP Adjusted Information
|
||||||||||||||||||||
|
Three Months Ended June 30, 2023 |
|||||||||||||||||||
|
GAAP |
|
Spin related
|
|
Restructuring |
|
Stock-based
|
|
Amortization |
|
Other(1) |
|
Non-GAAP
|
|||||||
Revenues |
$ |
1,608 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,608 |
|
|||
Cost of sales |
|
640 |
|
|
(10 |
) |
|
— |
|
(4 |
) |
|
(30 |
) |
|
— |
|
|
596 |
|
Gross profit |
|
968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,012 |
|
|||
Gross margin |
|
60.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
62.9 |
% |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative |
|
451 |
|
|
(44 |
) |
|
— |
|
(17 |
) |
|
— |
|
|
— |
|
|
390 |
|
Research and development |
|
128 |
|
|
(3 |
) |
|
— |
|
(4 |
) |
|
— |
|
|
— |
|
|
121 |
|
Acquired in-process research and development and milestones |
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Restructuring costs |
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Interest expense |
|
132 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
132 |
|
Exchange losses |
|
2 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
2 |
|
Other expense (income), net |
|
1 |
|
|
(4 |
) |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(3 |
) |
|
|
1,354 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,238 |
|
|||
Income before income taxes |
|
254 |
|
|
|
|
|
|
|
|
|
|
|
|
|
370 |
|
|||
Taxes on income |
|
12 |
|
|
13 |
|
|
— |
|
4 |
|
|
5 |
|
|
— |
|
|
34 |
|
Net income |
$ |
242 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
336 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Earnings per share - Diluted |
$ |
0.95 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1.31 |
|
|||
(1) Represents one-time costs. Spin-related includes costs from the separation of Merck & Co., Inc., |
|
Three Months Ended June 30, 2022 |
||||||||||||||||||||
|
GAAP |
|
Spin related
|
|
Restructuring |
|
Stock-based
|
|
Amortization |
|
Other(1) |
|
Non-GAAP
|
||||||||
Revenues |
$ |
1,585 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,585 |
|
||||
Cost of sales |
|
588 |
|
|
(6 |
) |
|
— |
|
(3 |
) |
|
(28 |
) |
|
(13 |
) |
|
|
538 |
|
Gross profit |
|
997 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,047 |
|
||||
Gross margin |
|
62.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
66.1 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative |
|
423 |
|
|
(28 |
) |
|
— |
|
(13 |
) |
|
— |
|
|
— |
|
|
|
382 |
|
Research and development |
|
106 |
|
|
(3 |
) |
|
— |
|
(3 |
) |
|
— |
|
|
— |
|
|
|
100 |
|
Acquired in-process research and development and |
|
97 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
97 |
|
Restructuring costs |
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
Interest expense |
|
98 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
98 |
|
Exchange gains |
|
(21 |
) |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
(21 |
) |
Other expense (income), net |
|
7 |
|
|
(8 |
) |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
(1 |
) |
|
|
1,298 |
|
|
|
|
|
|
|
|
|
|
|
|
|
1,193 |
|
||||
Income before income taxes |
|
287 |
|
|
|
|
|
|
|
|
|
|
|
|
|
392 |
|
||||
Taxes on income |
|
53 |
|
|
10 |
|
|
— |
|
3 |
|
|
4 |
|
|
3 |
|
|
|
73 |
|
Net income |
$ |
234 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
319 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share - Diluted |
$ |
0.92 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1.25 |
|
||||
(1) Represents one-time costs. Spin-related includes costs from the separation of Merck & Co., Inc., |
TABLE 4 (Continued)
Reconciliation of GAAP Reported to Non-GAAP Adjusted Information
|
||||||||||||||||||||||
|
Six Months Ended June 30, 2023 |
|||||||||||||||||||||
|
GAAP |
|
Spin related
|
|
Restructuring |
|
Stock-based
|
|
Amortization |
|
Other(1) |
|
Non-GAAP
|
|||||||||
Revenues |
$ |
3,146 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
3,146 |
|
|||||
Cost of sales |
|
1,220 |
|
|
(20 |
) |
|
— |
|
|
(8 |
) |
|
(59 |
) |
|
(2 |
) |
|
|
1,131 |
|
Gross profit |
|
1,926 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2,015 |
|
|||||
Gross margin |
|
61.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
64.0 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling, general and administrative |
|
886 |
|
|
(90 |
) |
|
— |
|
|
(32 |
) |
|
— |
|
|
(1 |
) |
|
|
763 |
|
Research and development |
|
257 |
|
|
(6 |
) |
|
— |
|
|
(7 |
) |
|
— |
|
|
— |
|
|
|
244 |
|
Acquired in-process research and development and milestones |
|
8 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
8 |
|
Restructuring costs |
|
4 |
|
|
— |
|
|
(4 |
) |
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
Interest expense |
|
264 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
264 |
|
Exchange losses |
|
11 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
11 |
|
Other expense (income), net |
|
7 |
|
|
(10 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(3 |
) |
|
|
2,657 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2,418 |
|
|||||
Income before income taxes |
|
489 |
|
|
|
|
|
|
|
|
|
|
|
|
|
728 |
|
|||||
Taxes on income |
|
70 |
|
|
26 |
|
|
1 |
|
|
8 |
|
|
11 |
|
|
— |
|
|
|
116 |
|
Net income |
$ |
419 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
612 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Earnings per share - Diluted |
$ |
1.64 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2.39 |
|
|||||
(1) Represents one-time costs. Spin-related includes costs from the separation of Merck & Co., Inc., |
|
Six Months Ended June 30, 2022 |
||||||||||||||||||||
|
GAAP |
|
Spin related
|
|
Restructuring |
|
Stock-based
|
|
Amortization |
|
Other(1) |
|
Non-GAAP
|
||||||||
Revenues |
$ |
3,152 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
3,152 |
|
||||
Cost of sales |
|
1,149 |
|
|
(10 |
) |
|
— |
|
(6 |
) |
|
(56 |
) |
|
(14 |
) |
|
|
1,063 |
|
Gross profit |
|
2,003 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2,089 |
|
||||
Gross margin |
|
63.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
66.3 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative |
|
794 |
|
|
(53 |
) |
|
— |
|
(23 |
) |
|
— |
|
|
— |
|
|
|
718 |
|
Research and development |
|
202 |
|
|
(6 |
) |
|
— |
|
(5 |
) |
|
— |
|
|
(1 |
) |
|
|
190 |
|
Acquired in-process research and development and |
|
97 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
97 |
|
Restructuring costs |
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
Interest expense |
|
195 |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
195 |
|
Exchange gains |
|
(25 |
) |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
(25 |
) |
Other expense (income), net |
|
11 |
|
|
(14 |
) |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
|
(3 |
) |
|
|
2,423 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2,235 |
|
||||
Income before income taxes |
|
729 |
|
|
|
|
|
|
|
|
|
|
|
|
|
917 |
|
||||
Taxes on income |
|
147 |
|
|
14 |
|
|
— |
|
5 |
|
|
9 |
|
|
3 |
|
|
|
178 |
|
Net income |
$ |
582 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
739 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share - Diluted |
$ |
2.28 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2.90 |
|
||||
(1) Represents one-time costs. Spin-related includes costs from the separation of Merck & Co., Inc., |
TABLE 5
Organon & Co.
|
|||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Income before income taxes |
$ |
254 |
|
|
$ |
287 |
|
|
$ |
489 |
|
|
$ |
729 |
|
Depreciation |
|
28 |
|
|
|
22 |
|
|
|
56 |
|
|
|
47 |
|
Amortization |
|
30 |
|
|
|
28 |
|
|
|
59 |
|
|
|
56 |
|
Interest expense |
|
132 |
|
|
|
98 |
|
|
|
264 |
|
|
|
195 |
|
EBITDA |
$ |
444 |
|
|
$ |
435 |
|
|
$ |
868 |
|
|
$ |
1,027 |
|
Restructuring costs |
|
— |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
One-time costs (1) |
|
61 |
|
|
|
58 |
|
|
|
129 |
|
|
|
98 |
|
Stock-based compensation |
|
25 |
|
|
|
19 |
|
|
|
47 |
|
|
|
34 |
|
Adjusted EBITDA |
$ |
530 |
|
|
$ |
512 |
|
|
$ |
1,048 |
|
|
$ |
1,159 |
|
Adjusted EBITDA margin |
|
33.0 |
% |
|
|
32.3 |
% |
|
|
33.3 |
% |
|
|
36.8 |
% |
(1) One-time costs primarily include costs incurred in connection with the spin-off of Organon, inventory step up adjustments and legal reserves. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230808112874/en/
Media Contacts:
Karissa Peer
(614) 314-8094
Kate Vossen
(732) 675-8448
Investor Contacts:
Jennifer Halchak
(201) 275-2711
Alex Arzeno
(203) 550-3972
Source: Organon & Co.
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