Viatris reported mixed results for Q4 2024, missing revenue and EPS expectations, despite noteworthy debt reduction and portfolio adjustments.Viatris (VTRS -15.61%), a global healthcare company known for its broad portfolio of pharmaceutical products, released its fourth-quarter 2024 results on Feb. 27. Despite achieving substantial debt reduction and strategic advancements, Viatris fell short of analysts' forecasts. The adjusted earnings per share (EPS) stood at $0.54, missing the estimated $0.56, while to ...

Core Viewpoint - Viatris reported quarterly earnings of $0.54 per share, missing the Zacks Consensus Estimate of $0.57 per share, and showing a decline from $0.61 per share a year ago, indicating an earnings surprise of -5.26% [1][2] Financial Performance - The company posted revenues of $3.53 billion for the quarter ended December 2024, missing the Zacks Consensus Estimate by 2.04%, and down from $3.84 billion year-over-year [2] - Over the last four quarters, Viatris has surpassed consensus EPS estimates two times and topped revenue estimates just once [2] Stock Performance - Viatris shares have declined approximately 9.7% since the beginning of the year, contrasting with the S&P 500's gain of 1.3% [3] - The current Zacks Rank for Viatris is 4 (Sell), indicating expected underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.63 on revenues of $3.58 billion, and for the current fiscal year, it is $2.57 on revenues of $14.25 billion [7] - The trend for estimate revisions ahead of the earnings release was unfavorable, which may impact future stock movements [6] Industry Context - The Medical Services industry, to which Viatris belongs, is currently in the top 34% of over 250 Zacks industries, suggesting a favorable industry outlook [8]

Q4 & Full Year 2024 Earnings February 27, 2025 1 This document contains proprietary information of Viatris Inc. Unauthorized use, duplication, dissemination or disclosure to third parties is strictly prohibited. © 2025 Viatris Inc. All Rights Reserved. VIATRIS and the Viatris Logo are trademarks of Mylan Inc., a Viatris company. Forward Looking Statements This presentation contains "forward-looking statements". These statements are made pursuant to the safe harbor provisions of the Private Securities Litiga ...

Financial Performance - Viatris reported total revenues of $14.7 billion for 2024, a decline of 5% compared to 2023, with operational revenue growth of 2% when excluding divestitures[3]. - U.S. GAAP net loss for 2024 was $(634) million, with adjusted EPS of $2.65 per share, a decrease of 10% from 2023[3]. - Total net sales in developed markets declined by 3%, while emerging markets saw a decline of 12% in 2024[5]. - Fourth quarter 2024 total net sales were $3.5 billion, up 1% on a divestiture-adjusted operational basis compared to fourth-quarter 2023 results[14]. - Total revenues for the year ended December 31, 2024, were $14,739.3 million, down from $15,426.9 million in 2023[36]. - The company reported a net loss of $516.5 million for Q4 2024, compared to a net loss of $765.6 million in Q4 2023[36]. - Adjusted EBITDA for the year ended December 31, 2024, was $4,669.4 million, down from $5,124.1 million in 2023, reflecting a decrease of 8.9%[46]. - Total revenue from key global products for the year ended December 31, 2024, was $1,468.8 million, a decrease of 5.8% from $1,559.3 million in 2023[41]. Cash Flow and Debt Management - The company achieved new product revenues of $582 million in 2024 and free cash flow of $2.0 billion, exceeding its guidance[2]. - U.S. GAAP net cash provided by operating activities was $483 million in the fourth quarter and $2.3 billion for the year, with free cash flow of $685 million in the fourth quarter and $2.6 billion for the year[14]. - Viatris ended 2024 with a gross leverage ratio of 2.9x after repaying $3.7 billion of debt[2]. - The company paid down approximately $1.4 billion in debt during the fourth quarter, achieving a long-term gross leverage target of 2.9x[14]. - Total reported debt as of December 31, 2024, was $14,039.5 million, with a gross debt to adjusted EBITDA ratio of 2.9x[55]. - Long-term debt decreased from $16,188.1 million in 2023 to $14,038.9 million in 2024[39]. Future Guidance and Expectations - Financial guidance for 2025 includes total revenues estimated between $13.5 billion and $14 billion, with a midpoint of $13.75 billion[18]. - Adjusted EBITDA for 2025 is projected to be between $3.9 billion and $4.2 billion, with a midpoint of $4.05 billion[18]. - Adjusted EPS for 2025 is expected to range from $2.12 to $2.26, with a midpoint of $2.19[18]. - The company expects to deliver $450 million to $550 million in new product revenues in 2025[31]. - The company expects U.S. GAAP net cash provided by operating activities for 2025 to be between $2.2 billion and $2.5 billion, with a midpoint of approximately $2.35 billion[17]. Operational Challenges - The company expects a negative impact of approximately $500 million on total revenues and $385 million on adjusted EBITDA in 2025 due to the FDA warning letter and import alert related to its Indore facility[11]. - The anticipated negative impact from the Indore facility is approximately $500 million to total revenues and $385 million to adjusted EBITDA[17]. - Viatris is implementing a comprehensive remediation plan for its Indore facility, with expectations for completion in a few months[12]. - The company has implemented a comprehensive remediation plan following an FDA inspection, with efforts more than halfway completed[31]. Research and Development - The company anticipates six Phase 3 data readouts and important late-stage development milestones for selatogrel, cenerimod, and sotagliflozin in 2025[3]. - Research and development expenses included $2.8 million in special items for the year ended December 31, 2024[46]. - Research and development (R&D) expenses for the three months ended December 31, 2024, were $206.5 million, representing 6% of total revenues, compared to 5% in the same period of 2023[50]. Shareholder Returns - Viatris plans to return $500 million to $650 million in capital to shareholders through share repurchases in 2025[3]. - The company plans to prioritize capital return in 2025, including $500 million to $650 million in share repurchases[30]. Miscellaneous - The company recorded a goodwill impairment charge of $321.0 million for the year ended December 31, 2024, related to the JANZ reporting unit[45]. - The company incurred acquisition and divestiture-related costs of $361.0 million for the year ended December 31, 2024[44]. - Adjusted earnings from operations for the three months ended December 31, 2024, were $870.6 million, down from $986.6 million in 2023[51].

Core Viewpoint - Viatris Inc. has announced a 2025 dividend policy of $0.48 per share, with a quarterly dividend of $0.12, marking the fifth consecutive year of dividend payments [1]. Company Overview - Viatris Inc. is a global healthcare company that combines generics and brand medications to address healthcare needs worldwide, supplying high-quality medicines to approximately 1 billion patients annually [2]. - The company aims to empower individuals to live healthier lives at every stage, with a diverse portfolio and a unique global supply chain [2]. - Viatris is headquartered in the U.S. and has global centers in Pittsburgh, Shanghai, and Hyderabad, India [2].

Core Viewpoint - Analysts forecast that Viatris (VTRS) will report quarterly earnings of $0.57 per share, reflecting a year-over-year decline of 6.6%, with anticipated revenues of $3.6 billion, down 6.3% compared to the previous year [1]. Earnings Projections - The consensus EPS estimate for the quarter has not changed over the past 30 days, indicating that analysts have not revised their initial projections [2]. - Revisions to earnings projections are crucial for predicting investor behavior, as empirical studies show a strong correlation between earnings estimate trends and short-term stock performance [3]. Revenue Estimates - Analysts predict 'Total Net Sales' to be $3.59 billion, indicating a year-over-year decline of 6.2% [5]. - 'Other revenues' are expected to reach $11.47 million, showing a slight increase of 0.6% year-over-year [5]. - 'Net Sales- JANZ' is forecasted at $366.35 million, reflecting a decrease of 1.6% from the prior year [5]. Market Segment Analysis - 'Net Sales- Emerging Markets' is projected to be $538.93 million, down 13% year-over-year [6]. - 'Net Sales- Developed Markets- Brands' is estimated at $1.21 billion, indicating a decline of 7.7% [6]. - 'Net Sales- JANZ- Brands' is expected to be $198.33 million, down 0.6% from the previous year [6]. Additional Segment Insights - 'Net Sales- JANZ- Generics' is anticipated to reach $168.03 million, reflecting a year-over-year decline of 13.1% [7]. - 'Net Sales- Emerging Markets- Brands' is projected at $401.94 million, showing an increase of 7.3% [7]. - 'Net Sales- Emerging Markets- Generics' is expected to be $171.99 million, indicating a significant decline of 29.7% [7]. Regional Sales Forecast - 'Net Sales- Greater China' is forecasted to be $553.04 million, reflecting a year-over-year increase of 7.3% [8]. - 'Net Sales- Developed Markets' is expected to reach $2.17 billion, indicating a decline of 6.5% [8]. - 'Net Sales- Developed Markets- Generics' is projected at $1.06 billion, reflecting a significant decrease of 26.1% from the prior year [8]. Stock Performance - Shares of Viatris have changed by +0.5% in the past month, contrasting with a -0.5% move in the Zacks S&P 500 composite [9]. - With a Zacks Rank 4 (Sell), VTRS is expected to underperform the overall market in the near future [10].

Core Viewpoint - Viatris (VTRS) is set to report its fourth-quarter and full-year 2024 results on February 27, 2025, with revenue estimates at $3.60 billion and earnings at $0.57 per share [1]. Revenue Segments - Viatris reports financial results across five segments: Developed Markets, Emerging Markets, Japan, Australia and New Zealand (JANZ), and Greater China [2]. - Developed Markets are expected to contribute $2.2 billion in revenue, driven by new product performance and strong generics [3]. - Emerging Markets are projected to generate $539 million, supported by the expansion of the cardiovascular portfolio in Latin America [4]. - JANZ markets are estimated to bring in $366 million, fueled by new product launches in Australia and volume growth in Japan [4]. - Greater China is anticipated to yield $553 million, benefiting from strong demand across various channels [5]. Product Categories - The brand business constitutes the majority of Viatris' portfolio, with performance bolstered by the cardiovascular portfolio expansion and strong growth in Europe and Greater China [6]. - Generic growth is attributed to the strength in the European portfolio and complex products in North America [6]. Operating Expenses - Operating expenses are likely to have increased due to investments in SG&A for the eye care franchise, new product launches, and advancements in key R&D programs [7]. Share Price Performance - Viatris' shares have decreased by 13.2% over the past year, compared to a 15.8% decline in the industry [8]. Earnings Surprise History - The company has a mixed earnings surprise history, beating estimates in two of the last four quarters and missing in the other two, with an average surprise of 0.33% [10]. Earnings Prediction Model - The current model does not predict a definitive earnings beat for Viatris, as it has an Earnings ESP of -3.51% and a Zacks Rank of 4 (Sell) [11][12].

Core Viewpoint - Viatris (VTRS) is anticipated to report a year-over-year decline in earnings due to lower revenues, which could significantly influence its near-term stock price depending on how actual results compare to consensus estimates [1][2]. Earnings Expectations - The upcoming earnings report is scheduled for February 27, 2025, with a consensus estimate of $0.57 per share, reflecting a year-over-year decrease of 6.6%. Revenues are projected to be $3.6 billion, down 6.3% from the previous year [3][2]. - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a stable outlook from covering analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for Viatris is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -3.51%, indicating a bearish sentiment among analysts [10]. - The stock currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat [11]. Historical Performance - In the last reported quarter, Viatris exceeded the expected earnings of $0.68 per share by delivering $0.75, resulting in a surprise of +10.29%. Over the past four quarters, the company has beaten consensus EPS estimates twice [12][13]. Conclusion - Viatris does not appear to be a strong candidate for an earnings beat based on current estimates and rankings, suggesting that investors should consider additional factors before making investment decisions [16].

Core Insights - Viatris Inc. will report its financial results for Q4 and the full year 2024 on February 27, 2025, with a webcast scheduled for 8:30 a.m. ET to discuss the results [1] - The company aims to provide access to high-quality medicines to approximately 1 billion patients globally each year, addressing healthcare needs across various life stages and conditions [2] Company Overview - Viatris is a global healthcare company that combines generics and brand-name products to meet healthcare needs [2] - The company is headquartered in the U.S. and has global centers in Pittsburgh, Shanghai, and Hyderabad, India [2] - Viatris has a diverse portfolio of medicines and a unique global supply chain designed to enhance access to healthcare [2]

Investment Opportunities - The Haggerston BioHealth marketplace channel offers at least 4 exclusive stock tips weekly, focusing on Pharma, Biotech, and Healthcare sectors, alongside access to investment bank-grade financial models and research [1] - The group caters to both novice and experienced biotech investors, providing catalysts, buy/sell ratings, product sales forecasts, integrated financial statements, discounted cash flow analysis, and market-by-market analysis for Big Pharma companies [2] Company Overview - Viatris (NASDAQ: VTRS) was formed in 2020 through the merger of generics drug giant Mylan and Pfizer's Upjohn business [2] - The company's Q3 2024 earnings announcement was preceded by a detailed overview, highlighting its strategic position in the generics and pharmaceutical markets [2] Analyst Background - Edmund Ingham, a biotech consultant with over 5 years of experience covering biotech, healthcare, and pharma, leads the Haggerston BioHealth investing group [2] - He has compiled detailed reports on over 1,000 companies, providing in-depth insights into the biotech and healthcare sectors [2]