Amneal Pharmaceuticals (AMRX) Q4 2024 Earnings Call February 28, 2025 05:14 PM ET Company Participants Anthony DiMeo - Senior Director of Investor RelationsChirag Patel - Co-Founder, Co-CEO, President & DirectorChintu Patel - Co-Founder, Co-CEO & DirectorTasos Konidaris - Executive Vice President, Chief Financial OfficerChris Schott - Managing DirectorJoe Renda - Senior VP & Chief Commercial Officer of SpecialtyLes Sulewski - VP - Biotech Equity ResearchJason Daly - Senior VP, Chief Legal Officer & Corporat ...

Q4 2024 Earnings Call Q4 2024 earnings call Agenda 1 Strategy & Business Update Chirag and Chintu Patel, Co-founders and Co-CEOs 2 Financial Results Tasos Konidaris, EVP & CFO 3 Q&A Chirag Patel, Co-CEO and President Joe Renda, SVP - Specialty 3 Cautionary statement on forward looking statements Certain statements contained herein, regarding matters that are not historical facts, may be forward-looking statements (as defined in the U.S. Private Securities Litigation Reform Act of 1995). Such forward-looking ...

Financial Data and Key Metrics Changes - In Q4 2024, revenues reached $731 million, an 18% increase year-over-year, with double-digit growth across all segments [42][46] - For the full year 2024, total revenues were $2.8 billion, a $400 million or 17% increase compared to the previous year, exceeding guidance [47][49] - Adjusted EBITDA for 2024 was $627 million, growing 12% year-over-year, and operating cash flow was $348 million [48][49] - Net leverage decreased to 3.9 times, down from 4.8 times at the end of 2023, achieving the target a year ahead of schedule [40][49] Business Line Data and Key Metrics Changes - The affordable medicine segment generated $1.7 billion in 2024, growing 15%, driven by new launches and a diversified portfolio [14][47] - Specialty business grew 14% in 2024, with a goal to exceed $500 million by 2027, supported by products like Crexent and Unithroid [10][11] - RevCare segment revenue grew 25% to $900 million, with expectations for continued double-digit growth [22][49] Market Data and Key Metrics Changes - The biosimilars segment generated $126 million in revenue in 2024, with plans for six commercial biosimilars by 2027 [17][18] - The global biosimilar market is projected to grow from $33 billion to $75 billion by 2030, presenting significant opportunities for the company [18][19] Company Strategy and Development Direction - The company aims to enhance its long-term growth profile through strategic initiatives like the launch of Crexent and collaboration with Medcera in the weight loss space [8][11] - Plans to build two new high-volume peptide manufacturing facilities to support the Medcera collaboration and expand capabilities in the weight loss market [12][30] - The focus remains on vertical integration and expanding the biosimilars portfolio, with a commitment to R&D and operational excellence [20][37] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving continued top and bottom-line growth in 2025, despite the anticipated loss of exclusivity for Rytary [41][50] - The company is optimistic about the early success of Crexent and its potential to become a leading therapy for Parkinson's disease [10][44] - Management highlighted the importance of maintaining a strong organic pipeline while considering strategic M&A opportunities [72][86] Other Important Information - The company is positioned as the largest US manufacturer of affordable medicines, fulfilling over 162 million prescriptions annually [24] - The strategic focus includes expanding into emerging markets and enhancing global access for products like Crexent [68] Q&A Session Summary Question: Can you elaborate on the launch of Crexent? - Management reported strong early adoption and positive patient testimonials, with formulary access currently at about 30% and expected to increase [60][65] Question: What are the thoughts on organic investments versus external business development? - The company is focused on a solid organic pipeline while also looking for strategic acquisitions to enhance its portfolio [72][86] Question: Any updates on naloxone contracts and Unithroid's long-term opportunity? - Naloxone contracts are progressing slowly, with expectations to provide 2.5 million kits this year [92] - Unithroid is expected to maintain a consistent growth profile similar to Synthroid [94] Question: What is the target for debt reduction in 2025? - The company aims to reduce net debt to EBITDA to around 3.6% to 3.7% in 2025, with a gross debt reduction target of $80 to $100 million [95][96]

Amneal Pharmaceuticals (AMRX) reported $730.52 million in revenue for the quarter ended December 2024, representing a year-over-year increase of 18.4%. EPS of $0.12 for the same period compares to $0.14 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $708.21 million, representing a surprise of +3.15%. The company delivered an EPS surprise of -20.00%, with the consensus EPS estimate being $0.15.While investors scrutinize revenue and earnings changes year-over-year and how they com ...

Financial Data and Key Metrics Changes - In Q4 2024, revenues reached $731 million, growing 18% year-over-year, with double-digit growth across all segments [30] - Full year 2024 total revenues were $2.8 billion, up $400 million or 17% year-over-year, exceeding guidance [32] - Adjusted EBITDA for Q4 was $155 million, reflecting a 9% increase, while full year adjusted EBITDA was $327 million, growing 12% [31][32] - Net leverage decreased to 3.9 times compared to 4.8 times at the end of 2023, with a target to reduce it further [29][33] Business Line Data and Key Metrics Changes - The Affordable Medicines segment grew 21% in Q4 to $439 million, with new product launches contributing $54 million [30] - Specialty revenues increased 16% to $121 million, driven by branded products including Krexant [31] - The AvCare segment grew 14% to $170 million, reflecting strong performance across distribution and government channels [31] - Biosimilars generated $39 million in Q4, growing 49% year-over-year [30] Market Data and Key Metrics Changes - The specialty business is projected to exceed $500 million by 2027, driven by products like Krexant and upcoming launches [8] - The global weight loss market is expected to exceed $150 billion by 2030, presenting a significant growth opportunity for the company [11] - The biosimilars market is projected to grow from $33 billion today to $75 billion by 2030, with a significant opportunity for cost savings in the U.S. [15] Company Strategy and Development Direction - The company aims to enhance its long-term growth profile through strategic initiatives such as launching Krexant and expanding its biosimilars pipeline [6][10] - A collaboration with MedCera focuses on developing next-generation therapies, positioning the company as a preferred supplier in the U.S. and Europe [10][22] - The company is committed to becoming vertically integrated, leveraging its manufacturing and R&D capabilities to drive growth in biosimilars and specialty products [26][37] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving continued top and bottom line growth in 2025, despite anticipated territory loss of exclusivity [29] - The company is focused on driving execution across development, manufacturing, and commercialization to support its diversified business [28] - Management highlighted the importance of maintaining a strong cash flow and reducing debt levels while investing in growth areas [37] Other Important Information - The company plans to launch 20 to 30 new products each year, with a focus on complex generics and injectables [24] - The first three biosimilars generated $126 million in revenue in 2024, with plans for additional filings and launches in the coming years [14][27] - The company is the largest U.S. manufacturer of affordable medicines, fulfilling over 162 million prescriptions annually [18] Q&A Session Summary Question: Can you elaborate on the launch of Krexant and its market dynamics? - Management reported strong initial adoption and positive patient testimonials, with market share reaching about 1% in four months, aiming for over 3% by year-end [7][41] Question: What is the current status of formulary access for Krexant? - The company is pleased with a 30% coverage rate and anticipates it to increase to around 50% this year, aiming to surpass Rytary's coverage [44] Question: How does the company plan to balance long-term investments with top-line growth? - The company has a solid organic pipeline and plans to allocate capital towards biosimilars and specialty portfolio additions while maintaining a focus on debt reduction [50][52] Question: What is the outlook for GLP-1 launches by 2028? - The company envisions a combination of U.S. and ex-U.S. products, including potential contract manufacturing opportunities [56] Question: Can you provide updates on naloxone contracts and Unithroid's long-term opportunity? - Naloxone contracts are progressing slowly, with expectations to provide 2.5 million kits this year, while Unithroid is expected to maintain a consistent growth profile [67] Question: What are the deleveraging targets for 2025? - The company aims to reduce net debt to EBITDA to approximately 3.6% to 3.7% in 2025, continuing its focus on debt reduction [70]

Group 1: Earnings Performance - Amneal Pharmaceuticals reported quarterly earnings of $0.12 per share, missing the Zacks Consensus Estimate of $0.15 per share, and down from $0.14 per share a year ago, representing an earnings surprise of -20% [1] - The company posted revenues of $730.52 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.15%, compared to year-ago revenues of $616.98 million [2] - Over the last four quarters, Amneal has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] Group 2: Stock Performance and Outlook - Amneal shares have increased by approximately 5.8% since the beginning of the year, while the S&P 500 has declined by -0.3% [3] - The sustainability of the stock's immediate price movement will depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the coming quarter is $0.16 on revenues of $704.43 million, and for the current fiscal year, it is $0.68 on revenues of $2.92 billion [7] Group 3: Industry Context - The Medical - Drugs industry, to which Amneal belongs, is currently in the top 34% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Amneal's stock performance [5][6]

Financial Performance - Q4 2024 net revenue was $731 million, an 18% increase from $617 million in Q4 2023[3] - Full year 2024 net revenue reached $2.79 billion, a 17% increase compared to $2.39 billion in 2023[3] - Q4 2024 adjusted net income was $40 million, with adjusted EBITDA of $155 million, reflecting a 9% increase from the previous year[3] - Full year 2024 adjusted EBITDA was $627 million, a 12% increase from the prior year[3] - Adjusted diluted EPS for full year 2024 was $0.58, a 9% decrease from $0.64 in 2023[3] - The company provided 2025 financial guidance of $3.0 to $3.1 billion in net revenue and $650 to $675 million in adjusted EBITDA[4] Segment Performance - Affordable Medicines segment revenue grew by 21% in Q4 2024, driven by new product launches and biosimilars[3] - AvKARE segment revenue increased by 14% in Q4 2024 due to new product launches[3] - Specialty segment revenue grew by 16% in Q4 2024, supported by key branded products including CREXONT®[3] - The Specialty Segment reported net revenue of $445,749 for the year ended December 31, 2024, up from $390,457 in 2023, marking a 14.2% increase[47] - The AvKARE Segment achieved net revenue of $662,945 for the year ended December 31, 2024, compared to $531,749 in 2023, representing a 24.7% growth[54] Expenses and Losses - Research and development expenses increased to $190.7 million for the year ended December 31, 2024, compared to $164.0 million in 2023, reflecting a 16.3% rise[17] - The net loss attributable to Amneal Pharmaceuticals, Inc. for the year ended December 31, 2024, was $116.9 million, compared to a net loss of $84.0 million in 2023, representing a 38.9% increase in losses[17] - The company incurred stock-based compensation expenses of $7,209 thousand for the three months ended December 31, 2024, compared to $5,974 thousand in the same period of 2023[30] - The company recorded a significant reduction in legal-related charges, with net charges of $96,692 in 2024 compared to $10,000 in 2023[40] Assets and Liabilities - Total current assets increased to $1,587.8 million as of December 31, 2024, from $1,377.9 million in 2023, marking a 15.2% growth[19] - Total liabilities decreased to $3,501.4 million as of December 31, 2024, from $3,472.6 million in 2023, indicating a slight reduction in overall liabilities[19] - Cash and cash equivalents at the end of the period increased to $110.6 million in 2024, up from $91.5 million in 2023, a growth of 20.5%[21] Cash Flow and Operating Activities - The company reported a net cash provided by operating activities of $295.1 million for the year ended December 31, 2024, compared to $345.6 million in 2023, a decrease of 14.6%[21] Corporate Structure and Strategy - The company implemented a reorganization plan on November 7, 2023, converting to a more traditional C-corporation structure[17] - The company plans to continue focusing on expanding its product pipeline and enhancing operational efficiencies in the upcoming fiscal year[17] - The company plans to continue focusing on market expansion and new product development to drive future growth[41] Leverage and Debt - The company reduced net leverage to 3.9x, ahead of its commitment to be below 4x[2] - The net leverage ratio improved to 3.9x as of December 31, 2024, down from 4.8x as of December 31, 2023[26] - Total gross debt as of December 31, 2024, was $2,584,835 thousand, a decrease from $2,766,826 thousand as of December 31, 2023[26]

Wall Street analysts forecast that Amneal Pharmaceuticals (AMRX) will report quarterly earnings of $0.15 per share in its upcoming release, pointing to a year-over-year increase of 7.1%. It is anticipated that revenues will amount to $707.4 million, exhibiting an increase of 14.7% compared to the year-ago quarter.The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates duri ...

Amneal Pharmaceuticals (AMRX) shares rallied 6% in the last trading session to close at $8.30. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 9.8% loss over the past four weeks.The sudden soaring of the stock price can be attributed to positive investor expectations regarding the strong market potential of its generics as well as specialty pharmaceutical products portfolios. This pharmaceutical company is ex ...

Core Viewpoint - J.P. Morgan has upgraded Amneal Pharmaceuticals due to the strong positioning of its generics business, particularly following the successful launch of Crexont and ongoing momentum across its portfolio [1][4]. Company Performance - The FDA approved Amneal's IPX203 for Parkinson's disease as Crexont in August 2024, with the drug launched in September [1]. - Crexont prescriptions are approaching 1,000 per week, with 964 recorded in the week of February 14, capturing about 15% of Rytary's volume [2]. - J.P. Morgan anticipates strong growth for Amneal, projecting Crexont revenue of $64 million in 2025, $125 million in 2026, and peak sales exceeding $300 million [3]. Financial Projections - Amneal is expected to report fourth-quarter sales of $707.05 million and adjusted EPS of 15 cents [3]. - J.P. Morgan has raised its price forecast for Amneal from $9 to $12, reflecting confidence in the company's growth trajectory [4]. Market Trends - The generics segment is expected to grow by double digits in 2024, with an anticipated 8% increase in 2025 driven by new generics and rising biosimilar adoption [5]. - The company has successfully transitioned its generics business from simple oral tablets to more complex products, supporting long-term growth [4][5]. - AMRX stock has increased by 8.75%, reaching $8.515 [5].