On February 1, 2017 Takeda reported Q3 FY2016 results (Press release, Takeda, FEB 1, 2017, View Source [SID1234517617]). Strong Q3 year-to-date （YTD） results propelled by Growth Drivers
Underlying Revenue grew +7.4％, with Takeda’s Growth Drivers （GI, Oncology, CNS and Emerging Markets） delivering growth of +15.5％, and Underlying Revenue growth across all regions （U.S. +14.4％, Japan +5.0％, Europe ＆ Canada +4.6％, Emerging Markets +4.9％）.
Reported revenue declined -5.6％, due to unfavorable currencies （-8.4pp） and the impact of divestitures （-4.5pp）.
Underlying Core Earnings grew +23.5％, with the Core Earnings margin increasing by 2.1pp. Despite unfavorable currencies and the negative impact of divestitures, reported operating profit was up +29.8％, benefiting from strong underlying growth and a one-time gain on the Teva JV transaction that was booked in Q1 FY2016.
Underlying Core EPS was up +31.7％, reflecting strong Core Earnings growth and a lower tax rate due to timing. Reported EPS was 212 yen, an increase of +46.3％ from 145 yen in the prior year.
Adjusted Operating Free Cash Flow was up +9.3％ to 120.0 billion yen.
Takeda’s Growth Drivers delivered +15.5% Underlying Revenue growth
GI underlying revenue +37.9％, driven by ENTYVIO and TAKECAB.
Oncology underlying revenue +6.3％, supported by uptake of NINLARO and ADCETRIS.
CNS underlying revenue +28.3％, underpinned by strong performance of TRINTELLIX.
Emerging Markets underlying revenue +4.9％, with robust growth in the key markets of Brazil （+9.5％）, China （+8.0％） and Russia （+7.3％）.
Christophe Weber, President and Chief Executive Officer of Takeda, commented:
"Our impressive year-to-date performance is evidence of how our strategic transformation is driving profitable growth. We are pleased to report that Takeda’s Growth Drivers （GI, Oncology, CNS and Emerging Markets） have maintained their strong momentum, driven in particular by the continued success of ENTYVIO and NINLARO. This gives us the confidence to improve the full-year outlook for FY2016.
Furthermore, we continue to make strong progress against our strategic transformation. In December, we announced our plan to sell Takeda’s shareholding in Wako Pure Chemical, and in January, we announced our plan to acquire ARIAD Pharmaceuticals. This deal will significantly enhance our global oncology portfolio and create value for our shareholders."
Reported Results for Q3 FY2016 YTD （April － December）
（billion yen） FY2015
Q3 YTD FY2016
Q3 YTD Growth
Revenue 1,393.3 1,315.8 －5.6％ ＋7.4％
Core Earnings1 267.9 228.3 －14.8％ ＋23.5％
Operating Profit 167.5 217.4 ＋29.8％ N/A
Net Profit3 113.6 165.7 ＋45.8％ N/A
EPS 145 yen 212 yen ＋46.3％ N/A
Core EPS 240 yen 229 yen －4.4％ ＋31.7％
1 Core Earnings is calculated by taking reported Gross Profit and deducting SG＆A expenses and R＆D expenses. In addition, certain other items that are non-core in nature and significant in value may also be adjusted.
2 Underlying growth compares two periods of financial results on a common basis, showing the ongoing performance of the business excluding the impact of foreign exchange and divestitures from both periods.
3 Attributable to the owners of the company.
FY2016 Management Guidance: Takeda increases management guidance for Underlying Core Earnings to "High-teen growth" and Underlying Core EPS to "Mid-teen growth"
（Oct 28, 2016） Revised Guidance
（Feb 1, 2017）
Mid-single digit growth（％） Mid-single digit growth（％）
Underlying Core Earnings
Mid- to high-teen growth（％） High-teen growth（％）
Underlying Core EPS
Low- to mid-teen growth（％） Mid-teen growth（％）
Annual Dividend per Share 180 yen 180 yen
FY2016 Reported Forecast: increased Core Earnings of 16-17 billion yen will offset accelerated 1 and potential impacts of the ARIAD acquisition2
（billion yen） Previous Forecast
（Oct 28, 2016） Revised Forecast
（Feb 1, 2017）
Revenue 1,670.0 1,700.0
R＆D Expenses －310.0 －315.0
Operating Profit 135.0 135.0
Net Profit3 91.0 93.0
EPS 116 yen 119 yen
Exchange Rate （annual average） 1 US$＝104 yen
1 euro＝117 yen 1 US$＝109 yen
1 euro＝120 yen
1 The revised forecast includes costs related to the R＆D transformation program of 47 billion yen in FY2016 （previous forecast was 40 billion yen）. Total estimated costs for the program are unchanged at 75 billion yen （28 billion yen expected in FY2017）.
2 Potential impacts to operating profit of approximately minus 9-10 billion yen are expected in FY2016 related to the acquisition of ARIAD Pharmaceuticals, Inc.
3 Attributable to the owners of the company
For more details on Takeda’s Q3 FY2016 YTD results and other financial information please visit View Source
Strong Q3 year-to-date （YTD） results propelled by Growth Drivers