Zoetis (ZTS) Q1 Earnings and Revenues Surpass Estimates

Core Insights - Zoetis, Inc. reported first-quarter 2023 adjusted earnings of $1.38 per share, exceeding the Zacks Consensus Estimate of $1.34 and up from $1.31 in the same quarter last year [1] - Total revenues for the quarter increased by 10% year over year to $2.19 billion, surpassing the Zacks Consensus Estimate of $2.14 billion [1] Quarterly Highlights - The U.S. segment revenues rose 16% year over year to $1.16 billion, beating the Zacks Consensus Estimate of $1.1 billion [3] - Companion animal product sales in the U.S. surged 25%, driven by monoclonal antibody products for osteoarthritis pain and other key dermatology products [3] - International segment revenues grew 3% year over year to $1.007 billion but fell short of the Zacks Consensus Estimate of $1.026 billion [4] Product Performance - Livestock product sales declined by 7% in the reported quarter, primarily due to lower cattle product sales [4] - Companion animal product sales in the international segment increased by 10% on a reported basis, driven by growth in key products [4] - Livestock product sales decreased 4% year over year on a reported basis but grew 2% operationally, with price increases contributing to growth in cattle and poultry portfolios [5] 2024 Guidance - Zoetis has lowered its 2024 adjusted earnings guidance to a range of $5.71-$5.81 per share from the previous $5.74-$5.84 [7] - Projected revenues for 2024 are between $9.05 billion and $9.2 billion, indicating operational growth of 8.5-10.5% [7] Strategic Developments - In April 2024, Zoetis announced a definitive agreement to divest its medicated feed additive product portfolio for $350 million to Phibro Animal Health, aligning with its capital allocation strategy [9] - The divestment aims to focus investments on animal health solutions, productivity, and sustainability [9]