Indivior PLC(INDV) - 2024 Q4 - Annual Report

Financial Performance - FY 2024 net revenue (NR) reached $1,188 million, a 9% increase compared to FY 2023[1] - FY 2024 SUBLOCADE® NR was $756 million, reflecting a 20% year-on-year growth; Q4 2024 NR for SUBLOCADE was $194 million[1] - FY 2025 guidance indicates a total NR decline of 17% at the midpoint, primarily due to a projected over 50% decrease in SUBOXONE Film NR[3] - Adjusted operating profit for FY 2024 was $312 million, a 16% increase from FY 2023[12] - FY 2024 adjusted operating profit increased 16% to $312 million from $269 million in FY 2023, driven by higher total net revenue despite increased SG&A expenses[25] - Q4 2024 reported operating profit was $40 million, down from $60 million in Q4 2023, while adjusted operating profit remained unchanged at $66 million[26] - FY 2024 reported net loss was $48 million, while adjusted net income was $222 million, slightly down from $223 million in FY 2023[29] - Net income for Q4 2024 was $9 million, a decrease from $54 million in Q4 2023, with a full year net loss of $(48) million compared to a profit of $2 million in FY 2023[150] - Adjusted net income for Q4 2024 was $41 million, down from $61 million in Q4 2023, while FY 2024 adjusted net income was $222 million, slightly down from $223 million in FY 2023[150] Cost Management and Investments - The company implemented streamlining actions expected to save over $100 million annually, with $50 million reinvested to support SUBLOCADE and OUD pipeline[2] - R&D expenses increased by 34% in FY 2024 to $142 million, reflecting investments in product development[22] - FY 2024 adjusted R&D expenses decreased 3% to $103 million from $106 million in FY 2023, with Q4 2024 adjusted R&D expenses down 10% to $27 million from $30 million in Q4 2023[23] - Selling, general and administrative expenses were adjusted to $576 million in FY 2024, compared to $543 million in FY 2023[146] - Research and development expenses included exceptional items of $39 million for FY 2024, compared to no exceptional items in FY 2023[149] Cash Flow and Liquidity - Cash and investments totaled $347 million at the end of FY 2024, down from $451 million in FY 2023, mainly due to litigation settlement payments and share repurchases[12] - Cash generated from operations in FY 2024 was $84 million, a significant improvement from cash used in operations of $292 million in FY 2023[34] - FY 2024 cash inflow from investing activities was $69 million, compared to an outflow of $98 million in FY 2023, reflecting maturing investments[35] - FY 2024 cash outflow from financing activities was $87 million, up from $46 million in FY 2023, due to share repurchases and cancellations[36] - Cash and cash equivalents remained stable at $319 million at the end of 2024, compared to $316 million at the end of 2023[54] Shareholder Actions - The company repurchased and canceled 9,415,726 shares as part of a $100 million share repurchase program completed on January 31, 2025[14] - The Group repurchased and canceled a total of 4,532,000 ordinary shares at $0.50 per share under a share repurchase program, with total purchases amounting to $168 million[126] - The Group's share capital decreased to 124,903,000 ordinary shares by December 31, 2024, down from 136,526,000 shares at the beginning of the year[122] Tax and Legal Matters - The effective tax rate for FY 2024 was 25%, up from 19% in FY 2023, influenced by the write-off of deferred tax assets and changes in U.K. tax rates[28] - The effective tax rate for FY 2024 was 71%, significantly higher than 11% in FY 2023, primarily due to the write-off of deferred tax assets and changes in U.K. tax rates[72] - The Group has been named as a defendant in over 400 civil lawsuits related to opioid marketing practices, with most cases consolidated in a federal multi-district litigation[114] - The Group intends to vigorously defend itself against all claims not resolved by the proposed settlement, with no estimate of possible loss available at this time[114] Acquisitions and Facilities - The Group acquired 100% of Opiant for an upfront cash consideration of $146 million, with an additional potential payment of $8.00 per share in Contingent Value Rights[127] - The cash outflow for the acquisition of Opiant was $124 million in Q1 2023, net of cash acquired[129] - On November 1, 2023, the Group acquired an aseptic manufacturing facility in the U.S. for $5 million in cash, aimed at securing long-term production of SUBLOCADE[131] - Committed capital spend for the acquired facility is approximately $21 million as of December 31, 2024[133] Operational Challenges - Reported operating loss for FY 2024 was $23 million, compared to a loss of $4 million in FY 2023, primarily due to higher net revenue offset by exceptional expenses and increased sales and marketing investments[24] - The company experienced an operating loss of $23 million in 2024, compared to a loss of $4 million in 2023[54] - The discontinuation of PERSERIS marketing led to a headcount reduction of approximately 130 employees and incurred charges of $61 million in 2024[136] - Impairment charges related to PERSERIS included $20 million for inventory and $9 million for marketed product intangible assets in FY 2024[137] Future Outlook - The company aims for SUBLOCADE's peak net revenue goal of over $1.5 billion, focusing on opioid use disorder treatment[4] - The company plans to address risks related to revenue growth expectations for SUBLOCADE, modeling a potential 10% decline in forecasts[65] - The Group's total finance expense increased to $43 million in FY 2024 from $38 million in FY 2023, influenced by higher interest expenses on borrowings[71]