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Press Release: Gilead Sciences Announces Fourth Quarter and Full Year 2020 Financial Results

· 02/04/2021 16:01
Three Months Ended December 31, ---------------------------------------------------------------------------------------------------------------- 2020 2019 ---------------------------------------------------- ---------------------------------------------------------- Net Income Diluted EPS Net Income Diluted EPS Impact Impact Impact Impact (In millions, except per share amounts, net of tax) unfavorable/(favorable) unfavorable/(favorable) unfavorable/(favorable) unfavorable/(favorable) -------------------- ------------------------- ------------------------- --------------------------- ----------------------------- Write-downs for excess inventory(1) $ -- $ -- $ 500 $ 0.39 Acquired IPR&D expenses(2)(6) 50 0.04 623 0.49 Losses (gains) from equity securities, net(3)(6) 628 0.50 (921) (0.72) Acquisition-related -- other costs(4)(6) 286 0.23 -- -- Discrete tax benefit related to intra-entity transfers(5)(6) -- -- (1,240) (0.97) ------------------------- ------------------------- ------------------- ----- ------------------ ------ Total $ 964 $ 0.77 $ (1,038) $ (0.81) ========== ============= ========== ============= ====== =========== ===== ====== ========== ====== Twelve Months Ended December 31, ---------------------------------------------------------------------------------------------------------------- 2020 2019 ---------------------------------------------------- ---------------------------------------------------------- Net Income Diluted EPS Net Income Diluted EPS Impact Impact Impact Impact (In millions, except per share amounts, net of tax) unfavorable/(favorable) unfavorable/(favorable) unfavorable/(favorable) unfavorable/(favorable) -------------------- ------------------------- ------------------------- --------------------------- ----------------------------- Write-downs for excess inventory(1) $ -- $ -- $ 544 $ 0.43 Acquired IPR&D expenses(2)(6) 5,672 4.49 3,917 3.07 Losses (gains) from equity securities, net(3)(6) 1,718 1.36 (1,241) (0.97) Acquisition-related -- other costs(4)(6) 445 0.35 -- -- Discrete tax benefit related to intra-entity transfers(5)(6) -- -- (1,240) (0.97) ------------------------- ------------------------- ------------------ ------ ----------------- ------- Total $ 7,835 $ 6.20 $ 1,980 $ 1.56 ========= ============== ========== ============= ====== ========== ======= ====== ========= ========-- Product sales excluding Veklury sales for the fourth quarter and full year 2020 decreased 7% and 3%, respectively, compared to the same periods in 2019, due to the continued effects of COVID-19 on Gilead's HIV and hepatitis C virus ("HCV") franchises, as well as the expected decline in sales of Truvada(R) (emtricitabine ("FTC") and tenofovir disoproxil fumarate ("TDF"))-based products due to the loss of exclusivity of Truvada and Atripla(R) (efavirenz 600 mg/emtricitabine 200 mg/tenofovir disoproxil fumarate 300 mg) in the United States in October 2020. See further discussion below. -- Veklury sales were $1.9 billion and $2.8 billion, for the fourth quarter and full year 2020, respectively, reflecting higher hospitalization and treatment rates due to the most recent COVID-19 surge.NM - Not Meaningful (1) Beginning in 2020, Gilead no longer regularly excludes share-based compensation expense from its non-GAAP financial information. To conform to this change, the prior period non-GAAP financial information has been recast to include share-based compensation expense. A reconciliation between GAAP and non-GAAP financial information is provided in the tables on pages 13 - 14.Three Months Twelve Months Ended Ended December 31, December 31, -------------- ---------------- (In millions, except percentages, per share amounts) 2020 2019 Change 2020 2019 Change -------------- ------ ------ ------ ------- ------- ------ Product sales excluding Veklury sales $5,390 $5,796 (7)% $21,544 $22,119 (3)% Veklury sales 1,938 -- NM 2,811 -- NM ------ ------ ------- ------- Total product sales $7,328 $5,796 26% $24,355 $22,119 10% Royalty, contract and other revenues 93 83 12% 334 330 1% ------ ------ ------- ------- Total revenues $7,421 $5,879 26% $24,689 $22,449 10% ----- ----- ------ ------ Net income attributable to Gilead $1,551 $2,696 (42)% $ 123 $ 5,386 (98)% Non-GAAP net income attributable to Gilead(1) $2,762 $1,400 97% $ 8,958 $ 7,828 14% Diluted EPS $ 1.23 $ 2.12 (42)% $ 0.10 $ 4.22 (98)% Non-GAAP diluted EPS(1) $ 2.19 $ 1.10 99% $ 7.09 $ 6.13 16%FOSTER CITY, Calif.--(BUSINESS WIRE)--February 04, 2021--

Gilead Sciences Announces Fourth Quarter and Full Year 2020 Financial Results

Fourth Quarter 2020 Year-Over-Year:

- Product Sales increased 26% to $7.3 billion, primarily due to Veklury(R) (remdesivir) -

- Diluted EPS of $1.23; Non-GAAP Diluted EPS of $2.19 -

Full Year 2020 Year-Over-Year:

- Product Sales increased 10% to $24.4 billion, primarily due to Veklury -

- Diluted EPS of $0.10; Non-GAAP Diluted EPS of $7.09 -

- Returned $5.0 billion of cash to shareholders through dividends and share repurchases -

Full Year 2021 Guidance:

- Product Sales including Veklury of $23.7 billion to $25.1 billion -

- Operating expenses flat to low single-digit percentage decline -

- Non-GAAP Diluted EPS of $6.75 to $7.45 -

Gilead Sciences, Inc. (Nasdaq: GILD) announced today its results of operations for the fourth quarter and full year 2020.

"Gilead continues to play a central role in the pandemic, with Veklury now treating one in two hospitalized patients in the United States. At the same time, we continue to meet the needs of people living with HIV, cancer, viral hepatitis and other conditions," said Daniel O'Day, Chairman and Chief Executive Officer, Gilead Sciences. "As we head into 2021, we have many additional opportunities to help patients, especially in oncology where Trodelvy, for example has the potential to treat a broad range of cancer types. These new opportunities, together with our continued leadership in antivirals put Gilead on a clear path to growth."

Financial Results

________________________________

Total revenues for the fourth quarter and full year 2020 increased 26% and 10%, respectively, compared to the same periods in 2019, primarily due to the launch of Veklury in 2020.

Diluted EPS decreased 42% to $1.23 for the fourth quarter 2020, and 98% to $0.10 for the full year 2020, compared to the same periods in 2019, primarily due to changes in the fair value of Gilead's equity investments in Galapagos NV ("Galapagos"), a 2019 discrete tax benefit related to intra-entity transfers and higher acquisition-related expenses. Full year 2020 was also impacted by higher acquired in-process research and development ("IPR&D") expenses.

Non-GAAP diluted EPS increased 99% to $2.19 for the fourth quarter 2020, and 16% to $7.09 for the full year 2020, compared to the same periods in 2019, primarily due to higher non-GAAP operating income driven by growth in product sales and improved gross margin, partially offset by higher research and development ("R&D") investments and other operating expenses.

The following tables summarize significant items that affected the comparability of net income attributable to Gilead and diluted EPS for the periods presented:

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February 04, 2021 16:01 ET (21:01 GMT)