Regulatory News:
Ipsen (Euronext: IPN; ADR: IPSEY), a global specialty-driven
biopharmaceutical group, today announced its financial results for
the full year 2019.
- Group sales growth of 15.8% as reported or 14.8% at
constant currency and scope of consolidation1, driven by Specialty
Care sales growth of 17.2%1, reflecting strong performance across
all major products and geographies, while Consumer Healthcare sales
were down -1.2%1
- Core Operating margin at 30.4% of net sales, up 0.7
points. IFRS Operating margin at -1.3% of net sales, down
24.6 points
- Setback in the palovarotene program of partial clinical
hold for all patients under 14 years of age and reaching
pre-specified second interim analysis futility criteria in the
Phase 3 MOVE trial for fibrodysplasia ossificans progressiva (FOP),
leading to a partial impairment of €669 million before tax
- Core consolidated net profit of €563 million (+14.6% vs.
2018), with fully diluted Core EPS growing by 14.1% to reach €6.74.
IFRS Consolidated net profit showing a loss of €50 million,
with an IFRS net loss per share of €0.61
- Sound financial structure, with a closing Net Debt of
€1,116 million and a Net Debt to EBITDA ratio at 1.3x. Strong Free
Cash Flow at €468 million, up 2%, mainly driven by higher Operating
Cash Flow.
- Continued commitment to disciplined execution of business
development strategy for long-term sustainability focusing on
the Group’s core therapeutic areas (Oncology, Neuroscience, Rare
Diseases) and across different transaction structures and various
phases of drug development
- Advancing solid pipeline with several significant new
chemical entities and Phase 3 / registrational trials, including
the initiation of pivotal Phase 3 trials for Onivyde® in 1L
Pancreatic Ductal Adenocarcinoma (PDAC) and 2L Small Cell Lung
Cancer (SCLC) and upcoming top-line results for the Phase 3 trial
of Cabometyx® in combination with nivolumab in 1L Renal Cell
Carcinoma (RCC)
- Proposed distribution of €1.00 per share2 for the 2019
financial year, consistent with the prior year
- 2020 guidance3 of Group sales growth greater than +6.0%
at constant currency and Core Operating margin around 30.0% of net
sales
- Updated 2022 outlook3 with Group sales greater than €2.8
billion and Core Operating margin greater than 28.0% of net
sales
Aymeric Le Chatelier, Chief Executive Officer and Chief
Financial Officer of Ipsen, stated: “2019 was another excellent
year of operating performance for Ipsen with continued double-digit
top-line growth and core operating margin expansion. Despite the
recent palovarotene setback, the fundamentals of our business
remain strong with a growing Specialty Care franchise and a sound
financial structure including attractive cash flow generation. We
are committed to the disciplined execution of our strategy,
delivering solid mid-single digit growth in 2020 and further
advancing our R&D pipeline programs. We have also updated our
2022 outlook taking into account the latest developments in the
current business. We remain focused on executing our internal and
external R&D strategy to strengthen our pipeline and deliver
sustainable growth for years to come.”
_______________________
1 Year-on-year growth excluding foreign exchange impact
established by recalculating net sales for the relevant period at
the rate used for the previous period. Sales [2]growth adjusted for
consolidation scope including: subsidiaries involved in the
partnership between Ipsen and Schwabe Group consolidated in
accordance with the equity method since 1 January 2019; and 2018
Etiasa® (mesalazine) sales adjusted for the new contractual set
up.
2 Decided by the Ipsen S.A. Board of Directors, which met on 12
February 2020, to propose at the Annual Shareholders’ meeting on 2
May 2020.
3 Assuming no impact of new somatostatin analog (SSA) generic
entry in 2020 and excluding impact of incremental investments in
pipeline expansion initiatives
Review of full year 2019
results
Extract of audited consolidated results for
the full year 2019 and 2018
(in million euros)
FY 2019
FY 2018
%
change
% change at
constant currency
and scope1
Group net sales
2,576.2
2,224.8
+15.8%
+14.8%
Specialty Care sales
2,299.4
1,924.5
+19.5%
+17.2%
Consumer Healthcare sales
276.8
300.3
-7.8%
-1.2%
CORE
Core Operating Income
782.6
659.9
+18.6%
Core Operating margin (as a % net
sales)
30.4%
29.7%
+0.7 pts
Core consolidated net profit
563.4
491.6
+14.6%
Core EPS – fully diluted (€)
6.74
5.91
+14.1%
IFRS
Operating Income
(33.4)
519.4
-106.4%
Operating margin (as a % net sales)
-1.3%
23.3%
-24.6 pts
Consolidated net profit
(50.2)
389.1
-112.9%
EPS – fully diluted (€)
(0.61)
4.68
-113.0%
Group net sales reached €2,576.2 million, up 14.8%1
year-on-year.
Specialty Care sales reached €2,299.4 million, up
17.2%1, driven by the continued strong growth of Somatuline®
(lanreotide) and the €376.9 million contribution from the key
Oncology launches of Cabometyx® (cabozantinib) and Onivyde®
(irinotecan liposome injection). Somatuline growth of 18.3%1 was
driven by continued positive momentum in North America (21.3%) and
solid performance throughout Europe, including Germany. Dysport®
(botulinum toxin type A) growth was fueled by good performance in
the therapeutics and in the aesthetics markets. Decapeptyl®
(triptorelin) sales reflect good volume growth across Major
European countries and in Southeast Asia.
Consumer Healthcare sales reached €276.8 million,
down -1.2%1, due to a decline in Smecta® (diosmectite) sales,
especially in China.
Core Operating Income reached €782.6 million in 2019,
compared to €659.9 million in 2018, a growth of 18.6%, driven by
the sales growth and after increased R&D investments to support
the development of the growing pipeline.
Core Operating margin reached 30.4% of net sales, up 0.7
points compared to 2018.
Core consolidated net profit was €563.4 million in 2019,
an increase of 14.6% versus €491.6 million in 2018, driven by
higher Core Operating Income compensated by increased net financial
costs, notably related to higher net debt from the Clementia
acquisition.
Fully diluted Core earnings per share grew by 14.1% to
reach €6.74, compared to €5.91 in 2018.
IFRS Operating Income was a loss of €33.4 million, mainly due to an
impairment charge of €668.8 million on the intangible assets of
palovarotene. IFRS operating margin of -1.3% was down 24.6 points
compared to 2018.
IFRS Consolidated net profit was a loss of €50.2 million due to financial
expenses resulting from the Onivyde contingent payment
reevaluation, financing costs and income tax for a total of €244.8
million, offset by the positive impact on financial result of the
revaluation of the Clementia Contingent Value Rights (CVR) and
milestones, and on income tax of the tax effect from the
palovarotene intangible asset impairment for a total of €220.0
million.
IFRS Fully diluted EPS (Earnings per share) was a
net loss per share amounting to €0.61 versus a net profit of €4.68
in 2018.
Free Cash Flow reached €467.7 million, up by €9.3
million, mainly driven by higher Operating Cash Flow partly offset
by higher cash out from restructuring costs, financial result and
current income tax.
Closing net debt reached €1,115.6 million at the end of
2019, as compared to closing net debt in 2018 of €242.5 million.
This reflects the acquisition of Clementia, other business
development and milestones, the impact of the application of
IFRS16, and the payment of the dividend.
Impairment loss related to palovarotene
program
Ipsen recorded a €668.8 million partial impairment, before tax,
on the palovarotene intangible assets at December 31, 2019 as a
result of the recent developments in the palovarotene development
program. This takes into account:
- 6 December 2019: Following discussions with the U.S. Food and
Drug Administration (FDA), a partial clinical hold was issued for
patients under the age of 14 for studies evaluating palovarotene
for the chronic treatment of fibrodysplasia ossificans progressiva
(FOP) and multiple osteochondromas (MO).
- 24 January 2020: Palovarotene Phase 3 MOVE trial for
fibrodysplasia ossificans progressiva (FOP) reached pre-specified
second interim analysis futility criteria. Ipsen paused dosing
patients in FOP trials taking into consideration IDMC’s
recommendation to not discontinue trials based on encouraging
therapeutic activity observed in preliminary post-hoc
analyses.
Ipsen will continue the development of palovarotene, conduct
further assessment of the MOVE dataset, address the FDA questions
and define next steps for the clinical program to bring
palovarotene to patients as quickly as possible.
Strategy update
During 2019, Ipsen made progress on its journey to being a
leading global biopharmaceutical company focused on innovation and
Specialty Care.
The three Specialty Care franchises all saw significant
progress. The Oncology and Neuroscience franchises continued to
demonstrate strong double-digit momentum and despite recent
developments with palovarotene, Ipsen remains committed to building
a successful Rare Diseases franchise and supporting patients living
with FOP. In October 2019, Ipsen in-licensed BLU-782 from Blueprint
Medicines, a highly selective ALK2 inhibitor in Phase 1 development
for the treatment of FOP.
Ipsen is committed to continuing its business development
strategy for long-term sustainability. The strategy will focus on
the Group’s core therapeutic areas (Oncology, Neuroscience, Rare
Diseases) and across different transactions structures and various
phases of drug development. The disciplined execution of this
strategy will be supported by the Group’s strong Free Cash Flow
generation and close internal collaboration across Ipsen’s
teams.
In 2020 and beyond, the Group’s mission to bring innovation to
patients remains the same. The priorities and roadmap are clear,
and Ipsen continues to execute against its objectives to maximize
the portfolio while increasing the value of the pipeline.
Comparison of 2019 performance with
financial objectives
The Group exceeded its upgraded guidance provided on 25 July
2019 as shown in the table below:
2019 Financial
objectives
2019 Actuals
Group sales growth
(at constant exchange rate)
> +14.0%1
+14.8%1
Core Operating margin (as a percentage of
sales)
around 30.0%
30.4%
Distribution for the 2019 financial
year proposed for the approval of Ipsen’s
shareholders
The Ipsen S.A. Board of Directors, which met on 12 February
2020, decided to propose at the Annual Shareholders’ meeting on 29
May 2020 the distribution of €1.00 per share for the 2019 financial
year, consistent with the prior year.
2020 Financial guidance
The Group has set the following financial targets for the
current year, assuming no impact in 2020 of new somatostatin analog
(SSA) generic entry:
■ Group sales growth year-on-year greater than
+6.0% at constant currency; no impact of currency expected
based on the current level of exchange rates.
■ Core Operating margin around 30.0% of net sales,
excluding incremental investments in pipeline expansion
initiatives.
Updated 2022 Outlook: The
Group has updated its 2022 outlook taking into account the latest
developments in its current business, mainly in the palovarotene
development program:
- Group net sales greater than €2.8 billion,
assuming current level of exchange rates;
- Core Operating margin greater than 28.0% of net
sales
The outlook has been updated assuming no approval of additional
meaningful products or indications (including no contribution from
palovarotene), progressive entry of additional octreotide and
lanreotide generics globally from 2021 and excluding the impact of
incremental investments in pipeline expansion initiatives.
Conference call
Ipsen will hold a conference call Thursday, 13 February 2020 at
2:30 p.m. (Paris time, GMT+1). Participants should dial in to the
call approximately five to ten minutes prior to its start. No
reservation is required to participate in the conference call.
Standard International: +44 (0) 2071 928 000
France and continental Europe: +33 (0) 1 76 70 07 94
UK: 08445 718 892
U.S.: (631) 510-7495
Conference ID: 8178467
A recording will be available for seven days on Ipsen’s
website.
____________________
1 Year-on-year growth excluding foreign exchange impact
established by recalculating net sales for the relevant period at
the rate used for the previous period. Sales growth adjusted for
consolidation scope including: subsidiaries involved in the
partnership between Ipsen and Schwabe Group consolidated in
accordance with the equity method since 1 January 2019; and 2018
Etiasa ® (mesalazine) sales adjusted for the new contractual set
up.
About Ipsen
Ipsen is a global specialty-driven biopharmaceutical group
focused on innovation and Specialty Care. The Group develops and
commercializes innovative medicines in three key therapeutic areas
– Oncology, Neuroscience and Rare Diseases. Its commitment to
oncology is exemplified through its growing portfolio of key
therapies for prostate cancer, neuroendocrine tumors, renal cell
carcinoma and pancreatic cancer. Ipsen also has a well-established
Consumer Healthcare business. With total sales over €2.5 billion in
2019, Ipsen sells more than 20 drugs in over 115 countries, with a
direct commercial presence in more than 30 countries. Ipsen’s
R&D is focused on its innovative and differentiated
technological platforms located in the heart of the leading
biotechnological and life sciences hubs (Paris-Saclay, France;
Oxford, UK; Cambridge, US). The Group has about 5,800 employees
worldwide. Ipsen is listed in Paris (Euronext: IPN) and in the
United States through a Sponsored Level I American Depositary
Receipt program (ADR: IPSEY). For more information on Ipsen, visit
www.ipsen.com.fr
Forward Looking Statement
The forward-looking statements, objectives and targets contained
herein are based on the Group’s management strategy, current views
and assumptions. Such statements involve known and unknown risks
and uncertainties that may cause actual results, performance or
events to differ materially from those anticipated herein. All of
the above risks could affect the Group’s future ability to achieve
its financial targets, which were set assuming reasonable
macroeconomic conditions based on the information available today.
Use of the words "believes", "anticipates" and "expects" and
similar expressions are intended to identify forward-looking
statements, including the Group’s expectations regarding future
events, including regulatory filings and determinations. Moreover,
the targets described in this document were prepared without taking
into account external growth assumptions and potential future
acquisitions, which may alter these parameters. These objectives
are based on data and assumptions regarded as reasonable by the
Group. These targets depend on conditions or facts likely to happen
in the future, and not exclusively on historical data. Actual
results may depart significantly from these targets given the
occurrence of certain risks and uncertainties, notably the fact
that a promising product in early development phase or clinical
trial may end up never being launched on the market or reaching its
commercial targets, notably for regulatory or competition reasons.
The Group must face or might face competition from generic products
that might translate into a loss of market share. Furthermore, the
Research and Development process involves several stages each of
which involves the substantial risk that the Group may fail to
achieve its objectives and be forced to abandon its efforts with
regards to a product in which it has invested significant sums.
Therefore, the Group cannot be certain that favorable results
obtained during pre-clinical trials will be confirmed subsequently
during clinical trials, or that the results of clinical trials will
be sufficient to demonstrate the safe and effective nature of the
product concerned. There can be no guarantees a product will
receive the necessary regulatory approvals or that the product will
prove to be commercially successful. If underlying assumptions
prove inaccurate or risks or uncertainties materialize, actual
results may differ materially from those set forth in the
forward-looking statements. Other risks and uncertainties include
but are not limited to, general industry conditions and
competition; general economic factors, including interest rate and
currency exchange rate fluctuations; the impact of pharmaceutical
industry regulation and health care legislation; global trends
toward health care cost containment; technological advances, new
products and patents attained by competitors; challenges inherent
in new product development, including obtaining regulatory
approval; the Group's ability to accurately predict future market
conditions; manufacturing difficulties or delays; financial
instability of international economies and sovereign risk;
dependence on the effectiveness of the Group’s patents and other
protections for innovative products; and the exposure to
litigation, including patent litigation, and/or regulatory actions.
The Group also depends on third parties to develop and market some
of its products which could potentially generate substantial
royalties; these partners could behave in such ways which could
cause damage to the Group’s activities and financial results. The
Group cannot be certain that its partners will fulfil their
obligations. It might be unable to obtain any benefit from those
agreements. A default by any of the Group’s partners could generate
lower revenues than expected. Such situations could have a negative
impact on the Group’s business, financial position or performance.
The Group expressly disclaims any obligation or undertaking to
update or revise any forward-looking statements, targets or
estimates contained in this press release to reflect any change in
events, conditions, assumptions or circumstances on which any such
statements are based, unless so required by applicable law. The
Group’s business is subject to the risk factors outlined in its
registration documents filed with the French Autorité des Marchés
Financiers. The risks and uncertainties set out are not exhaustive
and the reader is advised to refer to the Group’s 2018 Registration
Document available on its website (www.ipsen.com).
4th Quarter
Full Year
(in million euros)
2019
2018
% Variation
% Variation
at constant
.currency and
consolidation scope 1
2019
2018
% Variation
% Variation
at constant
currency and
consolidation
scope1
Oncology
505.2
414.6
21.8%
19.8%
1,844.4
1,503.0
22.7%
20.2%
Somatuline®
288.7
227.2
27.1%
24.2%
1,031.6
846.7
21.8%
18.3%
Decapeptyl®
110.1
100.2
9.9%
9.1%
407.4
372.6
9.3%
8.8%
Cabometyx®
65.9
47.4
39.0%
39.2%
242.2
148.2
63.5%
63.5%
Onivyde®
34.2
33.7
1.7%
-1.4%
134.7
109.4
23.1%
16.9%
Other Oncology
6.3
6.2
2.0%
2.0%
28.5
26.0
9.5%
9.3%
Neuroscience
105.5
88.7
18.9%
17.4%
391.3
351.5
11.3%
9.9%
Dysport®
104.6
87.3
19.8%
18.4%
388.3
347.8
11.6%
10.2%
Rare Diseases
14.6
16.9
-13.8%
-14.5%
63.7
70.0
-8.9%
-10.1%
NutropinAq®
9.7
10.5
-7.4%
-7.4%
41.8
45.9
-8.9%
-8.8%
Increlex®
4.9
6.4
-24.4%
-26.4%
21.9
24.1
-9.0%
-12.5%
Specialty Care
625.3
520.3
20.2%
18.3%
2,299.4
1,924.5
19.5%
17.2%
Smecta®
33.6
31.3
7.2%
5.2%
125.6
126.5
-0.8%
-1.8%
Forlax®
12.6
11.2
12.6%
11.5%
42.1
39.8
5.9%
5.4%
Tanakan®
10.3
12.1
-14.8%
-16.1%
36.7
37.7
-2.5%
-3.2%
Fortrans/Eziclen®
11.7
9.3
25.6%
23.4%
36.8
31.4
17.2%
16.0%
Other Consumer Healthcare
8.4
20.1
-58.2%
-41.8%
35.6
64.9
-27.6%
-17.5%
Consumer Healthcare
76.6
84.1
-8.9%
1.7%
276.8
300.3
-7.8%
-1.2%
Group Sales
701.9
604.4
16.1%
16.2%
2,576.2
2,224.8
15.8%
14.8%
Sales by therapeutic area and by product
Full year 2019 sales
highlights
Group sales reached €2,576.2 million, up 14.8%1, driven
by Specialty Care sales growth of 17.2%1, while Consumer Healthcare
sales decreased by 1.2%1.
Specialty Care sales amounted to €2,299.4 million, up
17.2%1. Oncology and Neuroscience sales grew by 20.2%1 and 9.9%1,
respectively, while Rare Diseases sales decreased by 10.1%1. Over
the period, the relative weight of Specialty Care continued to
increase to reach 89.3% of total Group sales, compared to 86.5% in
2018.
In Oncology, sales reached €1,844.4 million, up 20.2%1
year-on-year, driven by continued strong performance across all
major products and geographies. Over the period, Oncology sales
represented 71.6% of total Group sales, compared to 67.6% in
2018.
Somatuline – Sales reached €1,031.6 million, up 18.3%1
year-on-year, driven by 21.3%1 growth in North America primarily
from volume growth, as well as continued double-digit growth in
Europe with limited impact from the octreotide generic launch since
Q3 2019.
Decapeptyl – Sales reached €407.4 million, up 8.8%1
year-on-year, driven mainly by steady growth in China, volume
growth in Major Western Europe countries and in Algeria as well as
solid sales performance in southeast Asia.
Cabometyx – Sales reached €242.2 million, up 63.5%1
year-on-year, driven by good performance in all European countries,
as well as launches in Canada and in several countries in Asia and
Oceania.
Onivyde – Sales reached €134.7 million, up 16.9%1 year on
year, including growing demand in the U.S. and growing sales to
Ipsen’s ex-U.S. partner.
In Neuroscience, sales of Dysport reached €388.3
million, up 10.2%1, driven by good performance in the U.S. in the
therapeutics and aesthetics markets, solid performance of Galderma
in the aesthetics market in Brazil, as well as higher sales in
Russia and in the Middle East. Over the period, Neuroscience sales
represented 15.2% of total Group sales, compared to 15.8% in
2018.
In Rare Diseases, sales of NutropinAq reached
€41.8 million, down 8.8%1 year-on-year, impacted by the market
slowdown across Europe. Sales of Increlex reached €21.9
million, down 12.5%1 year-on-year mainly due to lower demand in the
U.S. Over the period, Rare Diseases sales represented 2.5% of total
Group sales, compared to 3.1% in 2018.
Consumer Healthcare sales reached €276.8 million, down
1.2%1, impacted by a decline in Smecta sales of 1.8%1 year-on-year
mainly due to the new hospital competitive environment in China and
lower sales in Algeria. Fortrans/Eziclen sales were up 16.0%1
year-on-year driven by China. Tanakan year-on-year sales were down
3.2%1, due to lower demand in China. Over the period, Consumer
Healthcare sales represented 10.7% of total Group sales, compared
to 13.5% in 2018.
_______________________
1 Year-on-year growth excluding foreign exchange impact
established by recalculating net sales for the relevant period at
the rate used for the previous period. Sales growth adjusted for
consolidation scope including: subsidiaries involved in the
partnership between Ipsen and Schwabe Group consolidated in
accordance with the equity method since 1 January 2019; and 2018
Etiasa® (mesalazine) sales adjusted for the new contractual set
up.
Sales by geographical area
4th Quarter
Full Year
(in million euros)
2019
2018
% Variation
% Variation
at constant
currency and
consolidation scope16
2019
2018
% Variation
% Variation
at constant
currency and
consolidation scope1
France
80.7
80.8
-0.1%
-0.2%
320.8
282.0
13.7%
13.3%
Germany
46.3
51.1
-9.3%
1.7%
188.0
184.1
2.1%
13.1%
Italy
27.8
22.9
21.4%
21.4%
115.6
101.5
13.9%
13.9%
Spain
28.9
24.8
16.6%
16.6%
106.0
91.1
16.3%
16.3%
United Kingdom
29.4
24.5
20.0%
17.1%
105.3
95.0
10.8%
10.0%
Major Western EU countries
213.2
204.1
4.4%
7.0%
835.7
753.8
10.9%
13.3%
Eastern Europe
73.1
57.0
28.3%
24.8%
229.3
198.0
15.8%
14.7%
Others Europe
72.8
60.2
21.0%
22.7%
271.3
245.7
10.4%
11.3%
Other EU Countries
145.9
117.2
24.5%
23.8%
500.6
443.7
12.8%
12.9%
North America
219.1
176.3
24.3%
19.8%
776.3
615.6
26.1%
19.5%
Asia
59.7
56.5
5.5%
12.1%
230.2
207.3
11.0%
11.9%
Other countries in Rest of the
world
64.1
50.3
27.5%
27.0%
233.4
204.3
14.2%
13.7%
Rest of the World
123.7
106.8
15.8%
19.4%
463.6
411.7
12.6%
12.8%
Group Sales
701.9
604.4
16.1%
16.2%
2,576.2
2,224.8
15.8%
14.8%
Sales in Major Western European countries reached €835.7
million, up 13.3%1 year-on-year. Over the period, sales in Major
Western European countries represented 32.4% of total Group sales,
compared to 33.9% in 2018.
France – Sales reached €320.8 million, up 13.3%1
year-on-year, driven by the Cabometyx ramp-up, continued growth of
Somatuline and Decapeptyl as well as the contribution of Onivyde
sales to Ipsen’s ex-U.S. partner since September 2018.
Germany – Sales reached €188.0 million, up 13.1%1
year-on-year, driven by Cabometyx, supported by the launch in
first-line renal cell carcinoma (RCC) and second-line
hepatocellular cell carcinoma (HCC) and the continued solid volume
growth of Somatuline.
Italy – Sales reached €115.6 million, up 13.9%1
year-on-year, driven by the increasing contribution from Cabometyx,
as well as the solid volume growth of Somatuline and strong
performance of Decapeptyl.
Spain – Sales reached €106.0 million, up 16.3%1
year-on-year, driven by the increasing contribution of Cabometyx
and the strong growth of Somatuline supported by the new delivery
system launch.
United Kingdom – Sales reached €105.3 million, up 10.0%1
year-on-year, driven by the solid performance of Somatuline and
Decapeptyl.
Sales in Other European countries reached €500.6 million,
up 12.9%1 year-on-year, driven by the launch of Cabometyx in
certain countries, and the continued strong growth of Somatuline
and Dysport. Over the period, sales in the region represented 19.4%
of total Group sales, compared to 19.9% in 2018.
Sales in North America reached €776.3 million, up 19.5%1
year-on-year driven by continued strong demand growth of
Somatuline, steady growth of Onivyde and Dysport and the increasing
contribution of Cabometyx in Canada. Sales in 2019 in North America
represented 30.1% of total Group sales, compared to 27.7% in
2018.
Sales in the Rest of the World reached €463.6 million, up
12.8%1 year-on-year, driven by Cabometyx launches in some countries
and the good performance of Decapeptyl and Somatuline, partly
offset by lower Smecta sales in China. Over the period, sales in
the Rest of the World represented 18.0% of total Group sales,
compared to 18.5% in 2018.
_______________________
1 Year-on-year growth excluding foreign exchange impact
established by recalculating net sales for the relevant period at
the rate used for the previous period. Sales growth adjusted for
consolidation scope including: subsidiaries involved in the
partnership between Ipsen and Schwabe Group consolidated in
accordance with the equity method since 1 January 2019; and 2018
Etiasa® (mesalazine) sales adjusted for the new contractual set
up.
Comparison of Core consolidated income statement for 2019 and
2018
Core financial measures are performance indicators.
Reconciliation between these indicators and IFRS aggregates is
presented in Appendix 4 “Bridges from IFRS consolidated net profit
to Core consolidated net profit”.
(in million euros)
31 December 2019 31 December 2018
% change % of sales % of sales Sales
2,576.2
100%
2,224.8
100%
15.8%
Other revenues
116.5
4.5%
123.6
5.6%
-5.7%
Revenue
2,692.8
104.5%
2,348.4
105.6%
14.7%
Cost of goods sold
(488.0)
-18.9%
(454.2)
-20.4%
7.4%
Selling expenses
(838.6)
-32.6%
(787.4)
-35.4%
6.5%
Research and development expenses
(388.8)
-15.1%
(302.1)
-13.6%
28.7%
General and administrative expenses
(181.4)
-7.0%
(165.7)
-7.4%
9.5%
Other core operating income
0.7
0.0%
21.1
0.9%
N.A. Other core operating expenses
(14.0)
-0.5%
(0.3)
0.0%
N.A.
Core Operating Income
782.6
30.4%
659.9
29.7%
18.6%
Net financing costs
(28.0)
-1.1%
(5.3)
-0.2%
N.A. Other financial income and expense
(28.8)
-1.1%
(20.1)
-0.9%
43.5%
Core income taxes
(166.2)
-6.5%
(144.1)
-6.5%
15.4%
Share of net profit (loss) from entities accounted for using the
equity method
3.7
0.1%
1.1
0.0%
243.6%
Core consolidated net profit
563.4
21.9%
491.6
22.1%
14.6%
- Attributable to shareholders of Ipsen S.A.
562.9
21.9%
491.9
22.1%
14.4%
- Attributable to non-controlling interests
0.5
0.0%
(0.4)
0.0%
N.A.
Core EPS fully diluted - attributable to Ipsen S.A.
shareholders (in € per share)
6.74
5.91
14.1%
Reconciliation from Core
consolidated net profit to IFRS consolidated net profit
Core consolidated net profit
563.4
491.6
Amortization of intangible assets (excl software)
(60.2)
(53.2)
Other operating income or expenses
(25.1)
(25.5)
Restructuring
(20.7)
(16.0)
Impairment losses
(668.8)
(15.0)
Other
161.2
7.2
IFRS consolidated net profit
(50.2)
389.1
IFRS EPS fully diluted - attributable to Ipsen S.A.
shareholders (in € per share)
(0.61)
4.68
At the end of December 2019, the Group Net Sales reached
€2,576.2 million, up 15.8% year-on-year or up 14.8%1 at constant
currency rate and scope of consolidation.
Other revenues for the financial year 2019 totaled €116.5
million, down 5.7% versus €123.6 million at the end of December
2018. The evolution was attributable to lower royalties paid by
Menarini for Adenuric® partially compensated by higher royalties
received from partners, mainly Galderma for Dysport® and Servier
for Onivyde®.
At the end of December 2019, Cost of goods sold amounted to
€488.0 million, representing 18.9% of Net sales, compared to €454.2
million or 20.4% of Net sales at the end of December 2018. The
favorable impact of Specialty Care growth on the product mix
continued to drive a decrease in the cost of goods sold as a
percentage of sales, partly offset by the increase of royalties
paid to partners.
In 2019, Selling expenses amounted to €838.6 million, up 6.5%
versus 2018, representing 32.6% of Net sales vs. 35.4% in 2018, an
improvement of 2.8 pts year on year. The increase in expenses
reflects the commercial efforts deployed to support the Cabometyx®
growth in Europe, the growth of Somatuline® in the United States
and in Europe, as well as commercial investments for Onivyde® in
the United States.
- Research and development expenses
For the financial year 2019, Research and development expenses
totaled €388.8 million, compared to €302.1 million in 2018. The
Group continued to invest in Research and development in Oncology,
especially for Cabometyx®, Onivyde® and the systemic radiation
therapy (SRT) programs, in Neuroscience, mainly for Dysport® life
cycle management and the new neurotoxin programs, but also in Rare
Diseases with the acquisition and integration of Clementia since
April 2019.
- General and administrative expenses
In 2019, General and administrative expenses amounted to €181.4
million, compared to €165.7 million at the end of December 2018,
with a stable ratio of sales year on year. The increase resulted
primarily from the reinforcement of corporate functions, the impact
of the Group’s positive performance on variable compensation and
some additional expenses from Clementia.
- Other core operating income and expenses
At year-end 2019, Other core operating income and expenses
amounted to an expense of €13.3 million versus an income of €20.8
million in 2018. This evolution is due to the impact of the
currency hedging policy.
Core Operating Income in 2019 reached €782.6 million,
representing 30.4% of sales, compared to €659.9 million in 2018,
representing 29.7% of sales, a growth of 18.6% and an increase in
profitability of 0.7 points.
- Net financing costs and Other financial income and
expense
In 2019, the Group incurred Net financial expenses of €56.8
million, versus €25.3 million in 2018.
Net financing costs increased by €22.7 million, driven by
financing costs linked to the Clementia acquisition and to IFRS16 -
Leases standard implemented on 1 January 2019.
Other financial income and expense increased by €8.7 million,
mainly attributable to the re-evaluation, of the future payments
related to acquisitions as well as depreciation of financial
assets.
In 2019, Core income tax expense of €166.2 million resulted from
a core effective tax rate of 22.9% on core profit before tax
compared to a core effective tax rate of 22.7% in 2018.
- Core consolidated net profit
In 2019, Core consolidated net profit increased by 14.6% to
€563.4 million, with €562.9 million fully attributable to Ipsen
S.A. shareholders. This compares to Core consolidated net profit of
€491.6 million, with €491.9 million fully attributable to Ipsen
S.A. shareholders in 2018.
In 2019, Core EPS fully diluted came to €6.74, up 14.1% versus
€5.91 per share in 2018.
______________________
1 Year-on-year growth excluding foreign exchange impact
established by recalculating net sales for the relevant period at
the rate used for the previous period. Sales growth adjusted for
consolidation scope including: subsidiaries involved in the
partnership between Ipsen and Schwabe Group consolidated in
accordance with the equity method since 1 January 2019; and 2018
Etiasa® (mesalazine) sales adjusted for the new contractual set
up.
From Core financial measures to IFRS reported figures
Reconciliations between IFRS 2018 / 2019 results and the Core
financial measures are presented in Appendix 4.
In 2019, the main reconciling items between Core consolidated
net income and IFRS consolidated net income were:
- Amortization of intangible assets (excluding
software)
Amortization of intangible assets (excluding software) in 2019
amounted to €83.8 million before tax, compared to €73.1 million
before tax in 2018. The variation mainly relates to the
amortization of Cabometyx® and Onivyde® intangible assets.
- Other operating income and expenses
Other non-core operating income and expenses for 2019 amounted
to an expense of €35.8 million before tax, mainly related to
Clementia integration costs and costs arising from the Group’s
transformation programs.
Other non-core operating income and expenses for 2018 amounted
to an expense of €30.4 million before tax, mainly related to the
termination of R&D studies, costs arising from the Group’s
transformation programs and a settlement with Galderma in Brazil,
partially compensated by a favorable settlement with a U.S.
partner.
In 2019, restructuring costs came to €27.7 million before tax,
mainly impacted by the costs related to the relocation of the
Onivyde manufacturing site from Cambridge, Massachusetts, to Signes
in France and the remaining costs for the U.S. commercial affiliate
relocation.
In 2018, restructuring costs came to €21.9 million before tax,
impacted by the relocation of the U.S. commercial affiliate to
Cambridge, Massachusetts.
In 2019, the Group recognized an impairment loss of €668.8
million before tax on the intangible asset of palovarotene.
To appreciate the recoverable value of the intangible asset
palovarotene, the Group has considered various scenarios to which a
probability of occurrence has been allocated. The recoverable value
has also been determined taking into consideration the discounted
value of the expected future cash flows resulting from the
different scenarios over the product expected lifetime. The
calculation integrates the new clinical data, the potential sales
developments as well as estimated approval dates for the different
indications.
In 2018, the Group recognized an impairment loss of €15.0
million before tax on the intangible asset of Xermelo®.
- Other(Financial income and expenses, Income taxes and net
profit from discontinued operations)
2019 other financial income and expenses included a financial
income of €114.6 million related to the Contingent Value Rights
(CVR) and milestones revaluation on Clementia, partially offset by
a financial expense of €59.7 million related to Onivyde® earn out
revaluation resulting from the update of probabilities of success
of certain R&D studies.
2019 Income taxes included an expense of €71.9 million
corresponding to the write-off of deferred tax assets related to
Clementia given the limited probability of recoverability within 5
years; and an income of €177.2 million related to the revaluation
of the deferred tax liabilities along with the impairment of the
intangible assets of palovarotene.
In 2019, net profit from discontinued operations amounts to €4.2
million, compared to €2.0 million in 2018.
As a consequence, IFRS reported indicators are:
In 2019, a €33.4 million operating loss was recorded versus a
€519.4 million net income in 2018. This decrease mainly results
from the impairment recorded on the intangible asset of
palovarotene.
The Consolidated net loss was €50.2 million in 2019, compared to
a €389.1 million net profit in 2018.
Fully diluted EPS was a net loss per share amounting to €0.61
net loss per share in 2019 versus €4.68 net profit per share in
2018.
Operating segments: Core Operating Income by therapeutic
area
Segment information is presented according to the Group's two
operating segments, Specialty Care and Consumer Healthcare.
All costs allocated to these two segments are presented in the
key performance indicators. Only corporate overhead costs and the
impact of the currency hedging policy are not allocated to the two
operating segments.
The Group uses Core operating income to measure its performance.
Core operating income is the indicator used by the Group to measure
operating performance and to allocate resources.
Sales, Revenue and Core Operating Income are presented by
therapeutic area for the 2019 and 2018 financial years in the
following table:
(in million euros)
31 December 2019 31 December 2018
Change % Specialty Care Sales
2,299.4
1,924.5
374.9
19.5%
Revenue
2,373.9
1,987.1
386.8
19.5%
Core Operating Income
938.6
740.4
198.2
26.8%
% of sales
40.8%
38.5%
Consumer Healthcare Sales
276.8
300.3
(23.5)
-7.8%
Revenue
318.9
361.3
(42.4)
-11.7%
Core Operating Income
55.1
83.9
(28.8)
-34.3%
% of sales
19.9%
27.9%
Total Unallocated Core Operating Income
(211.1)
(164.5)
(46.6)
28.3%
Group total Sales
2,576.2
2,224.8
351.4
15.8%
Revenue
2,692.8
2,348.4
344.4
14.7%
Core Operating Income
782.6
659.9
122.8
18.6%
% of sales
30.4%
29.7%
In 2019, Specialty Care sales grew to €2,299.4 million,
up 19.5% over 2018, reaching 89.3% of total consolidated sales at
31 December 2019, versus 86.5% a year earlier. In 2019, Core
Operating Income for Specialty Care amounted to €938.6 million,
representing 40.8% of sales. The improvement reflects the continued
growth of Somatuline® in the United States and Europe, the
contribution of Cabometyx® and Onivyde® as well as the performance
of Dysport®, after increased Research & Development investments
to support the development of the growing pipeline including
palovarotene.
In 2019, Consumer Healthcare sales came to €276.8
million, down 7.8% year-on-year. Core Operating Income for
Consumer Healthcare amounted to €55.1 million, representing 19.9%
of sales, compared to 27.9% in 2018, reflecting lower sales and
commercial investments to support the transformation and the
strategy.
In 2019, Unallocated Core Operating Income came to a
negative €211.1 million, compared to a negative €164.5 million in
the year-earlier period. The evolution is mainly attributable to
the positive impact from the currency hedging policy in 2018, as
well as the reinforcement of the corporate infrastructure and the
impact of the Group’s positive performance on variable
compensation.
Net cash flow and financing
The implementation of IFRS 16 - Leases standard has led to an
increase in financial liabilities of €188.2 million as of 1 January
2019 bringing the opening net debt to €430.7 million.
The Group had a net debt increase of €684.9 million over 2019
after Clementia acquisition, bringing closing net debt to €1,115.6
million.
- Analysis of the consolidated net cash flow
statement
(in million euros)
31 December 2019 31 December 2018
Opening net cash / (debt)
(430.7)
(463.3)
Core Operating Income
782.6
659.9
Non-cash items
76.4
41.2
Change in operating working capital requirement
(7.2)
3.6
(Increases) decreases in other working capital requirement
38.5
5.3
Net capex (excluding milestones paid)
(172.5)
(120.4)
Dividends received from entities accounted for using the equity
method
0.9
0.9
Operating Cash Flow
718.7
590.5
Other non-core operating income and expenses and restructuring
costs (cash)
(45.5)
(31.7)
Financial income (cash)
(53.3)
(25.9)
Current income tax (P&L, excluding provisions for tax
contingencies)
(150.2)
(89.3)
Other operating cash flow
(2.0)
14.9
Free Cash Flow
467.7
458.4
Dividends paid
(83.5)
(83.5)
Net investments (Business Development and milestones)
(1,127.4)
(120.2)
Share buyback
(16.8)
(24.6)
FX on net indebtedness
72.6
(10.2)
Other (discontinued operations and financial instruments)
2.4
0.9
Shareholders return and external growth operations
(1,152.6)
(237.6)
CHANGE IN NET CASH / (DEBT)
(684.9)
220.8
Closing net cash / (debt)
(1,115.6)
(242.5)
At the end of 2019, Operating Cash Flow totaled €718.7 million,
up €128.2 million (+21.7%) versus 2018, mainly driven by higher
Core Operating Income (up €122.8 million) and favorable working
capital requirements compensated by higher capital investments.
Non-cash items increased, in 2019, by €76.4 million versus an
increase of €41.2 million in 2018, impacted by €30.8 million as a
result of IFRS16 – Leases standard implementation on 1 January
2019.
Working capital requirement for operating activities increased
by €7.2 million at the end of 2019, compared to a decrease of €3.6
million at the end of 2018. The increase in 2019 stemmed mainly
from:
- a €25.6 million increase in inventories during the year, to
support business growth;
- a €79.9 million increase in trade receivables, in-line with the
phasing of sales and impacted by longer payment terms in some
countries;
- a €98.4 million increase in trade payables as of December 2019,
as compared to an increase of €62.4 million in 2018 and in line
with the phasing of operating expenses.
At the end of 2019, other working capital requirement needs
decreased by €38.5 million, mainly driven by an increase in tax
liabilities.
Net capital expenditure amounted to €172.5 million at the end of
2019, €14.9 million of which was due to IFRS16 - Leases
implementation, compared to €120.4 million in 2018, and mainly
included projects to support increased production capacity at
industrial sites in the United Kingdom and France, investments
related to the U.S. affiliate relocation as well as corporate
investments in information technology and digital projects.
Free Cash Flow at the end of 2019 came to €467.7 million, up
€9.3 million versus 2018, mainly driven by higher Operating Cash
Flow combined with higher cash out from restructuring costs,
financial result and current income tax.
Other non-core operating income and expenses and restructuring
costs of €45.5 million mainly included the integration costs
related to Clementia acquisition as well as cash out from the U.S.
relocation and from the Group’s transformation programs.
The €53.3 million in financial expenses paid in 2019, increasing
by €27.4 million compared to 2018, due to higher financing costs
related to the Clementia acquisition and hedging costs.
The change in current income tax stemmed mainly from the
increase in Operating Income combined with higher financial
expenses and the end of the use of U.S. tax losses.
- Shareholders return and external growth operations
In 2019, the dividend payout to Ipsen S.A. shareholders amounted
to €83.2 million.
Net investments in 2019 amounted to €1,127.4 million, including
the acquisition of Clementia for €986 million (including
transaction fees), the in-licensing of BLU-782 from Blueprint
Medicines Corporation for €22 million and additional milestones of
€101 million paid to Exelixis and of €13 million to MD Anderson
Cancer Center.
Net investments in 2018 amounted to €120.2 million, including
additional milestones paid to Exelixis for €98 million, an equity
investment in Arix Bioscience for €17 million, the milestones paid
following the license agreement signed with MD Anderson Cancer
Center in May 2018 and additional milestones paid to 3B
Pharmaceuticals for a total of €14 million and the final payment
for the acquisition of Akkadeas Pharma for €8 million, partly
offset by the milestone received from Servier for Onivyde® for €20
million and from Galderma for the territory extension in Asia for a
net total of €12 million.
Reconciliation of cash and cash equivalents and net cash
(in million euros)
31 December 2019 31 December 2018
Current financial assets (derivative instruments on financial
operations)
0.1
0.7
Closing cash and cash equivalents
339.0
310.9
Non-current loans
(568.2)
(297.9)
Other financial liabilities (excluding derivative instruments) (**)
(286.6)
(88.1)
Non-current financial liabilities
(854.7)
(386.0)
Credit lines and bank loans
(270.8)
(4.0)
Financial liabilities (excluding derivative instruments) (**)
(329.3)
(164.1)
Current financial liabilities
(600.0)
(168.1)
Debt
(1,454.7)
(554.1)
Net cash / (debt) (*)
(1,115.6)
(242.5)
(*) Net cash / (debt): derivative instruments booked in
financial assets and related to financial operations, cash and cash
equivalents, less bank overdrafts, bank loans and other financial
liabilities and excluding financial derivative instruments on
commercial operations.
(**) Financial liabilities mainly exclude €7.2 million in
derivative instruments related to commercial operations in 2019,
compared with €15.8 million one year earlier.
On 16 June 2016, Ipsen S.A. issued €300 million in unsecured,
seven-year public bonds. The bonds mature on 16 June 2023 with a
coupon at an annual interest rate of 1.875%.
On 23 July 2019, Ipsen S.A. issued $300 million through a U.S.
Private Placement (“USPP”) in two tranches of 7 and 10- year
maturities.
Ipsen S.A. has refinanced its Revolving Credit Facility (“RCF”)
and existing bilateral bank facilities. The new Revolving Credit
Facility of €1,500 million signed on 24 May 2019 has a five-year
maturity and includes two one-year extension options. The previous
RCF was fully terminated on 28 June 2019.
In both the new RCF and the USPP, the Group has to comply with a
Net Debt / EBITDA covenant to remain below 3.5 times at each
financial closing and the facility includes specific indicators
linked to Corporate Social Responsibility (“CSR”) to be assessed
annually.
On 31 December 2019, the RCF was drawn for €271 million and the
Group was complying with its covenant ratio.
The Ipsen S.A. program of emission of NEU CP - Negotiable
EUropean Commercial Paper of €600 million was drawn for €260
million on 31 December 2019.
- Impact of IFRS 16 - Leases
The application of IFRS 16 – Leases has led to an increase in
tangible assets of €169.4 million and financial liabilities of
€188.2 million as of 1 January 2019.
The impact on the Operating Income reached a profit of €4.3
million as of 31 December 2019; the impact on the Consolidated Net
profit reached a loss of €1.4 million.
APPENDICES
- Appendix 1 – Consolidated income statement
(in million euros)
31 December 2019 31 December 2018
Sales
2,576.2
2,224.8
Other revenues
116.5
123.6
Revenue
2,692.8
2,348.4
Cost of goods sold
(488.0)
(454.2)
Selling expenses
(838.6)
(787.4)
Research and development expenses
(388.8)
(302.1)
General and administrative expenses
(181.4)
(165.7)
Other operating income
15.6
39.0
Other operating expenses
(148.5)
(121.7)
Restructuring costs
(27.7)
(21.9)
Impairment losses
(668.8)
(15.0)
Operating Income
(33.4)
519.4
Investment income
2.0
3.1
Financing costs
(30.0)
(8.4)
Net financing costs
(28.0)
(5.3)
Other financial income and expense
22.8
(20.1)
Income taxes
(19.6)
(108.1)
Share of net profit (loss) from entities accounted for using the
equity method
3.7
1.1
Net profit (loss) from continuing operations
(54.4)
387.0
Net profit (loss) from discontinued operations
4.2
2.0
Consolidated net profit (loss)
(50.2)
389.1
- Attributable to shareholders of Ipsen S.A.
(50.7)
389.5
- Attributable to non-controlling interests
0.5
(0.4)
Basic earnings per share, continuing operations (in
euros)
(0.66)
4.67
Diluted earnings per share, continuing operations (in euros)
(0.66)
4.65
Basic earnings per share, discontinued operations (in euros)
0.05
0.02
Diluted earnings per share, discontinued operations (in euros)
0.05
0.02
Basic earnings per share (in euros)
(0.61)
4.70
Diluted earnings per share (in euros)
(0.61)
4.68
- Appendix 2 – Consolidated balance sheet before allocation of
net profit
(in million euros)
31 December 2019 31 December
2018 ASSETS Goodwill
632.6
395.6
Other intangible assets
1,383.2
1,011.9
Property, plant & equipment
679.3
474.5
Equity investments
64.9
65.2
Investments in companies accounted for using the equity method
18.8
15.5
Non-current financial assets
27.7
92.9
Deferred tax assets
149.4
131.9
Other non-current assets
4.5
4.4
Total non-current assets
2,960.4
2,191.8
Inventories
214.0
198.5
Trade receivables
565.0
463.0
Current tax assets
22.8
47.7
Current financial assets
59.3
5.5
Other current assets
132.2
126.4
Cash and cash equivalents
353.3
344.5
Total current assets
1,346.5
1,185.6
TOTAL ASSETS
4,306.9
3,377.4
EQUITY AND LIABILITIES Share capital
83.8
83.8
Additional paid-in capital and consolidated reserves
1,656.1
1,366.0
Net profit (loss) for the period
(50.7)
389.5
Foreign exchange differences
61.8
1.8
Equity attributable to Ipsen S.A. shareholders
1,751.0
1,841.1
Equity attributable to non-controlling interests
2.0
2.3
Total shareholders' equity
1,753.1
1,843.4
Retirement benefit obligation
60.7
63.8
Non-current provisions
30.5
44.5
Other non-current financial liabilities
854.7
386.0
Deferred tax liabilities
107.7
19.7
Other non-current liabilities
47.8
61.0
Total non-current liabilities
1,101.4
574.9
Current provisions
9.1
21.1
Current financial liabilities
609.5
184.2
Trade payables
508.5
379.8
Current tax liabilities
13.7
11.4
Other current liabilities
297.4
329.0
Bank overdrafts
14.3
33.6
Total current liabilities
1,452.5
959.2
TOTAL EQUITY & LIABILITIES
4,306.9
3,377.4
- Appendix 3 – Cash flow statements
- Appendix 3.1 – Consolidated statement of cash flow
(in million euros)
31 December 2019 31 December
2018 Consolidated net profit (loss)
(50.2)
389.1
Share of profit (loss) from entities accounted for using the equity
method
0.9
(0.2)
Net profit (loss) before share from entities accounted for using
the equity method
(49.3)
388.9
Non-cash and non-operating items - Depreciation,
amortization, provisions
161.2
142.6
- Impairment losses included in operating income and net financial
income
670.7
15.0
- Change in fair value of financial derivatives
(11.0)
(2.0)
- Net gains or losses on disposals of non-current assets
3.7
4.8
- Unrealized foreign exchange differences
(7.2)
(6.5)
- Change in deferred taxes
(130.6)
19.2
- Share-based payment expense
15.8
12.8
- Other non-cash items
(46.0)
(1.1)
Cash flow from operating activities before changes in working
capital requirement
607.3
573.8
- (Increase) / decrease in inventories
(25.6)
(29.8)
- (Increase) / decrease in trade receivables
(79.9)
(29.0)
- Increase / (decrease) in trade payables
98.4
62.4
- Net change in income tax liability
30.4
26.5
- Net change in other operating assets and liabilities
(2.8)
(33.0)
Change in working capital requirement related to operating
activities
20.4
(2.9)
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES
627.7
570.9
Acquisition of property, plant & equipment
(144.5)
(107.4)
Acquisition of intangible assets
(136.1)
(180.1)
Proceeds from disposal of intangible assets and property, plant
& equipment
0.6
3.2
Acquisition of shares in non-consolidated companies
(10.6)
(30.2)
Payments to post-employment benefit plans
(10.0)
(1.2)
Impact of changes in the consolidation scope
(817.2)
(7.4)
Change in working capital related to investment activities
(36.8)
49.6
Other cash flow related to investment activities
(2.7)
(0.8)
NET CASH PROVIDED (USED) BY INVESTMENT ACTIVITIES
(1,157.3)
(274.3)
Additional long-term borrowings
286.3
0.9
Repayment of long-term borrowings
(0.6)
(3.9)
Net change in short-term borrowings
357.7
(107.3)
Capital increase
0.1
2.6
Treasury shares
(16.8)
(10.3)
Dividends paid by Ipsen S.A.
(83.2)
(83.0)
Dividends paid by subsidiaries to non-controlling interests
(0.3)
(0.5)
Change in working capital related to financing activities
6.7
(0.7)
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES
550.0
(202.2)
CHANGE IN CASH AND CASH EQUIVALENTS
20.4
94.4
Opening cash and cash equivalents
310.9
209.3
Impact of exchange rate fluctuations
7.7
7.3
Closing cash and cash equivalents
339.0
310.9
- Appendix 3.2 – Consolidated net cash flow statement
(in million euros)
31 December 2019 31 December
2018 Opening cash and cash equivalents
422.5
Opening net cash / (debt) (1)
(430.7)
(463.3)
CORE OPERATING INCOME
782.6
659.9
Non-cash items
45.6
41.2
(Increase) /decrease in inventories
(25.6)
(29.8)
(Increase) / decrease in trade receivables
(79.9)
(29.0)
Increase / (decrease) in trade payables
98.4
62.4
Change in operating working capital requirement
(7.2)
3.6
Change in income tax liability
30.4
26.5
Change in other operating assets and liabilities (excluding
milestones received)
8.2
(21.2)
Other changes in working capital requirement
38.5
5.3
Acquisition of property, plant & equipment
(129.6)
(107.4)
Acquisition of intangible assets (excluding milestones paid)
(29.8)
(26.7)
Disposal of fixed assets
0.6
3.2
Change in working capital related to investment activities
1.1
10.5
Net capex (excluding milestones paid)
(157.6)
(120.4)
Dividends received from entities accounted for using the equity
method
0.9
0.9
Operating Cash Flow
718.7
590.5
Other non-core operating income and expenses and restructuring
costs (cash)
(45.5)
(31.7)
Financial income (cash)
(47.6)
(25.9)
Current income tax (P&L, excluding provisions for tax
contingencies)
(150.2)
(89.3)
Other operating cash flow
(2.0)
14.9
Free Cash Flow
467.7
458.4
Dividends paid (including payout to non-controlling
interests)
(83.5)
(83.5)
Acquisition of shares in non-consolidated companies (2)
(11.1)
(25.3)
Acquisition of other financial assets
-
0.0
Impact of changes in consolidation scope (3)
(984.8)
(8.0)
Milestones paid (4)
(143.7)
(117.2)
Milestones received (5)
7.5
36.0
Other Business Development operations
4.8
(5.7)
Net investments (Business Development and milestones)
(1,127.4)
(120.2)
Share buyback
(16.8)
(24.6)
FX on net indebtedness and change in earn out
72.6
(10.2)
Other (discontinued operations and financial instrument)
4.2
0.9
Shareholders return and external growth operations
(1,152.6)
(237.6)
CHANGE IN NET CASH / (DEBT)
(684.9)
220.8
Closing net cash / (debt)
(1,115.6)
(242.5)
(1) The opening net cash / (debt) includes the impact of the
application of IFRS 16 – Leases for an amount of €188.2m.
(2) Acquisition of shares in non-consolidated companies mainly
reflected investments in external innovation funds.
(3) Impact of change in consolidation scope notably reflects
Clementia acquisition.
(4) Milestones paid in 2019 correspond to payments subject to
the terms and conditions set out in the Group's partnership
agreements including €101 million milestone paid to Exelixis and
€13 million paid to MD Anderson as well as €22m upfront paid to
Blueprint Medicines Corporation for the in-licensing of BLU-782.
The amounts paid were recorded as an increase in intangible assets
on the consolidated balance sheet. The transactions were included
in the "Acquisition of intangible assets" line item in the
consolidated statement of cash flow (see Appendix 4.1).
(5) Milestones received are amounts collected by Ipsen from its
partners including €7m from Galderma related to Mexico territory
received in 2019, while the Group received €21 million from
Servier, in 2018, related to the Onivyde® acquisition closed in
2017. The milestones amounts (except for Servier) are recorded as
“Deferred income” in the consolidated balance sheet and then
recognized in the income statement as "Other revenues" in case of
dynamic license or directly in "Other revenues" in case of static
license. In the consolidated balance sheet, the Servier milestones
not yet received are booked in “Current financial assets” and in
“Non-current financial assets”, depending on the forecasted cash-in
timing. Servier milestones received are included in the "Other cash
flow related to investment activities" line item in the
consolidated statement of cash flow (see Appendix 3.1).
- Appendix 4 – Bridges from IFRS consolidated net profit to
Core consolidated net profit
IFRS CORE (in million euros)
31 December
2019
Amortization of
intangible assets
(excl software)
Other operating
income or expenses
Restructuring Impairment losses Other 31
December 2019 Sales
2,576.2
2,576.2
Other revenues
116.5
116.5
Revenue
2,692.8
-
-
-
-
-
2,692.8
Cost of goods sold
(488.0)
(488.0)
Selling expenses
(838.6)
(838.6)
Research and development expenses
(388.8)
(388.8)
General and administrative expenses
(181.4)
(181.4)
Other operating income
15.6
(14.9)
0.7
Other operating expenses
(148.5)
83.8
50.7
(14.0)
Restructuring costs
(27.7)
27.7
-
Impairment losses
(668.8)
668.8
-
Operating Income
(33.4)
83.8
35.8
27.7
668.8
-
782.6
Net financing costs
(28.0)
(28.0)
Other financial income and expense
22.8
(51.6)
(28.8)
Income taxes
(19.6)
(23.6)
(10.6)
(7.0)
-
(105.4)
(166.2)
Share of net profit (loss) from entities accounted for using the
equity method
3.7
3.7
Net profit (loss) from continuing operations
(54.4)
60.2
25.1
20.7
668.8
(157.0)
563.4
Net profit (loss) from discontinued operations
4.2
(4.2)
-
Consolidated net profit
(50.2)
60.2
25.1
20.7
668.8
(161.2)
563.4
- Attributable to shareholders of Ipsen S.A.
(50.7)
60.2
25.1
20.7
668.8
(161.2)
562.9
- Attributable to non-controlling interests
0.5
0.5
Earnings per share fully diluted - attributable to Ipsen
S.A. shareholders (in € per share)
(0.61)
0.72
0.30
0.25
8.01
(1.93)
6.74
The reconciliation items between Core consolidated net profit
and IFRS consolidated net profit are described in the paragraph
“From Core financial measures to IFRS reported figures”.
IFRS CORE (in million euros)
31 December
2018
Amortization of
intangible assets
(excl software)
Other operating
income or expenses
Restructuring Impairment losses Other 31
December 2018 Sales
2,224.8
2,224.8
Other revenues
123.6
123.6
Revenue
2,348.4
-
-
-
-
-
2,348.4
Cost of goods sold
(454.2)
(454.2)
Selling expenses
(787.4)
(787.4)
Research and development expenses
(302.1)
(302.1)
General and administrative expenses
(165.7)
(165.7)
Other operating income
39.0
(17.9)
21.1
Other operating expenses
(121.7)
73.1
48.3
(0.3)
Restructuring costs
(21.9)
21.9
-
Impairment losses
(15.0)
15.0
-
Operating Income
519.4
73.1
30.4
21.9
15.0
-
659.9
Net financing costs
(5.3)
(5.3)
Other financial income and expense
(20.1)
(20.1)
Income taxes
(108.1)
(20.0)
(4.9)
(6.0)
-
(5.2)
(144.1)
Share of net profit (loss) from entities accounted for using the
equity method
1.1
1.1
Net profit (loss) from continuing operations
387.0
53.2
25.5
16.0
15.0
(5.2)
491.6
Net profit (loss) from discontinued operations
2.0
(2.0)
-
Consolidated net profit
389.1
53.2
25.5
16.0
15.0
(7.2)
491.6
- Attributable to shareholders of Ipsen S.A.
389.5
53.2
25.5
16.0
15.0
(7.2)
491.9
- Attributable to non-controlling interests
(0.4)
(0.4)
Earnings per share fully diluted - attributable to Ipsen
S.A. shareholders (in € per share)
4.68
0.64
0.31
0.19
0.18
(0.09)
5.91
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200212006022/en/
Media Christian Marcoux, M.Sc. Senior Vice
President, Global Communications +33 (0)1 58 33 67 94
Christian.marcoux@ipsen.com
Financial Community Eugenia Litz Vice President,
Investor Relations +44 (0) 1753 627721 Eugenia.litz@ipsen.com
Fanny Allaire Director, Ipsen France Hub, Global
Communications +33 (0) 1 58 33 58 96 Fanny.allaire@ipsen.com
Myriam Koutchinsky Investor Relations Manager +33 (0)1 58
33 51 04 Myriam.koutchinsky@ipsen.com
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