Ipsen’s 2015 results and 2016 financial objectives

 

The Board of Directors of Ipsen, chaired by Marc de Garidel, met on 29 February 2016 to review the Group’s results for 2015, published today. The annual financial report, with regards to the regulated information, will be available on the Group’s website, old.ipsen.com, Investor Relations section.

 

Extract from audited consolidated results for 2015 and 2014 (in million euros)
(in million euros) 2015 2014 % change
Specialty care sales 1 114,2 947,1 +14,4%1
Primary care sales  329,7  327,8 -1,1%1
Group sales  1 443,9  1 274,8 +10,4%1 
Core Operating Income 322,5  260,6  +23,8%  
Core operating margin  22,3% 20,4%  +1,9
Consolidated net profit 190,7    154,0 +23,8% 
Core EPS – fully diluted (€) 2,78    2,22 +25,2% 
Net operating cash-flow  223,6  245,8  -9,0%
Closing cash 214,0 180,1 +18,8%

 

Sales growth excluding foreign exchange impact, calculated by applying the average 2015 rates to the 31 December 2014 sales figures

 

Commenting on the full year 2015 performance, Marc de Garidel, Chairman and Chief Executive Officer of Ipsen, said: “We are pleased with the Group’s excellent 2015 operating performance. Sales grew by more than 10% year-on-year, driven by the successful launch of Somatuline® in neuroendocrine tumors in the US and Europe, and the sound Dysport® performance in aesthetics. Core operating income grew by close to 24%, reflecting our continuous transformation and cost monitoring efforts.” Marc de Garidel added: “In 2016 we will continue to post strong sales growth thanks to the good Somatuline® and Dysport® momentum. In addition, we are pleased to announce the in-licensing of the global rights ex North America and Japan of cabozantinib for the second line treatment of advanced renal cell carcinoma, for which commercial launch is expected in 2017 in Europe. This sizeable operation will provide Ipsen with a global platform in oncology and a key growth driver for the coming years.”

 

Review of the full year 2015 results

Note: Unless stated otherwise, all variations in sales are stated excluding foreign exchange impacts.

In 2015, Group sales reached €1,443.9 million, up 10.4% year-on-year. Specialty care sales reached €1,114.2 million, up 14.4%, driven by:

  • The strong growth of Somatuline® in North America following the launch of the neuroendocrine tumor indication, as well as a solid performance throughout Europe;
  • The good performance of Dysport® in the aesthetic indication, notably through the Galderma partnership ;
  • Decapeptyl® sales, up 1.3% over the period, affected by the slowdown in China.

In 2015, primary care reached €329.7 million, down 1.1% year-on-year. Sales declined by 7.7% in France, partially offset by international growth of 1.2%.

Core Operating Income totaled €322.5 million in 2015, up 23.8%. Core operating margin reached 22.3%, up 1.9 point compared to 2014, mainly driven by the acceleration of the development in the United States, the good performance in Europe, and appropriate cost control.

As of 31 December 2015, the Group recorded a €57.0 million impairment loss to fully impair the intangible asset related to tasquinimod following the decision to stop all clinical trials with the product as announced on 16 April, 2015.

Consolidated net profit was up 23.8% over the period to €190.7 million. Fully diluted core earnings per share (see Appendix 4) grew by 25.3% year-on-year to reach €2.78 for 2015, compared to €2.22 in 2014.

Net operating cash-flow generated in 2015 reached €223.6 million, compared to €245.8 million in 2014, due to a €81.2 million increase of the working capital requirement for operating activities in 2015, compared to a decrease of €5.3 million in 2014.

Closing cash reached €214.0 million over the period, compared to €180.1 million in 2014.

 

 

Comparison of 2015 performance with financial objectives
Financial objectives1 Actuals 2015
Specialty care sales ≥+14%2 +14,4% 2
Primary care sales [-3% ; +0%]2 -1,1%2
Core operating marging ≥ 22,0% of sales 22,3% of sales

 

Dividend for the 2015 financial year proposed for the approval of Ipsen’s shareholders
Ipsen S.A. Board of Directors, which met on 29 February 2016, has decided to propose at Ipsen’s annual shareholders’ meeting to be held on 31 May 2016 the payment of a dividend of €0.85 per share, stable year-on-year.

 

In-licensing agreement for the rights ex North America and Japan of cabozantinib (Exelixis)
Ipsen today announced a licensing agreement for the rights ex-North America and Japan of cabozantinib, a compound owned by US company Exelixis, which is already marketed under the name COMETRIQ® for the treatment of thyroid cancer. The compound is also developed for other indications, with a regulatory application filed in Europe in January 2016 for the second line treatment of advanced renal cell carcinoma (RCC), and an ongoing phase 3 clinical trial for the second line treatment of Hepatocellular carcinoma (HCC). Upon regulatory approval, the commercial launch for the treatment of RCC is expected early 2017 in Europe.

 

2016 financial objectives
The Group has set the following financial targets for 2016:

  • Specialty care sales growth year-on-year in excess of 10.0%;
  • Slight primary care sales growth year-on-year;
  • Core operating margin of around 21%, including a negative impact of around 150 basis points resulting from the investment required to prepare the commercial launch of cabozantinib for the treatment of advanced renal cell carcinoma in Europe (in-licensing agreement announced today), and of around 100 basis points from foreign exchange rates.

Sales objectives are set at constant currency.

 

Update of 2020 outlook
Taking into account the additional growth stemming from the in-licensing of cabozantinib, Ipsen upgrades its sales targets and confirms its core operating margin objective for 2020, with:

  • Sales in excess of 2.0 billion euros, driven by cabozantinib sales in 2019 and 2020;
  • A core operating margin beyond 26%, despite the investment phase in 2017 and 2018 to launch cabozantinib for the treatment of advanced renal cell carcinoma in Europe. Ipsen will continue to implement cost containment initiatives and project arbitration to minimize impact on overall Group profitability.

1 2015 revised financial objectives communicated on 31 July 2015
2 Sales growth excluding foreign exchange impact, calculated by applying the average 2015 rates to the 31 December 2014 sales figures

 

Press conference (in French)

Ipsen will host a press conference on Tuesday 1 March 2016 at 9:00 a.m. (Paris time, GMT +1) at Salons de l’hôtel des Arts et Métiers – 9 bis avenue d’Iéna – 75116 Paris (France).

 

Meeting, webcast and Conference Call (in English) for the financial community

Ipsen will host an analyst meeting on Tuesday 1 March 2016 at 2:30 p.m. (Paris time, GMT+1) at its headquarters in Boulogne-Billancourt (France). A conference call will take place and a web conference (audio and video webcast) will be available at old.ipsen.com. Participants should enter the call in approximately 5 to 10 minutes prior to its start. The reference for the conference is ID 957325. No reservation is required to participate in the conference call.. Phone numbers to call in order to connect to the conference are: from France and continental Europe +33 (0)17 0993 209, from UK +44 (0)207 1312 711 and from the United States +1 646 461 1757. A recording will be available for 7 days on Ipsen’s website and at the following numbers: from France and continental Europe +33 (0)1 70 99 35 29, from UK +44 (0)20 7031 4064 and from the United States +1 954 334 0342 and access code is 957325

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