[July 23, 2014] |
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Gilead Sciences Announces Second Quarter 2014 Financial Results
FOSTER CITY, Calif. --(Business Wire)--
Gilead Sciences, Inc. (Nasdaq: GILD) announced today its results of
operations for the quarter ended June 30, 2014. Total revenues for the
second quarter of 2014 increased to $6.53 billion compared to $2.77
billion for the second quarter of 2013. Product sales for the second
quarter of 2014 increased to $6.41 billion compared to $2.66 billion for
the second quarter of 2013. Net income for the second quarter of 2014
was $3.66 billion, or $2.20 per diluted share compared to $772.6 million
or $0.46 per diluted share for the second quarter of 2013. Non-GAAP net
income for the second quarter of 2014, which excludes
acquisition-related, restructuring and stock-based compensation
expenses, was $3.93 billion, or $2.36 per diluted share compared to
$839.7 million or $0.50 per diluted share for the second quarter of 2013.
"During the second quarter, Gilead continued to make significant
progress led by strong Sovaldi sales. Since December's launch, Sovaldi
has been prescribed for more than 80,000 patients in the U.S. and
Europe, underscoring the medical community's recognition of the benefits
of this product," said John C. Martin, PhD, Gilead's Chairman and Chief
Executive Officer. "We look forward to making Sovaldi available in
additional countries."
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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(In thousands, except per share amounts)
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2014
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2013
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2014
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2013
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Product sales
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$
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6,412,937
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$
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2,657,285
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$
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11,283,911
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$
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5,050,853
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Royalty, contract and other revenues
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122,006
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110,109
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249,988
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248,176
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Total revenues
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$
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6,534,943
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$
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2,767,394
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$
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11,533,899
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$
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5,299,029
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Net income attributable to Gilead
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$
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3,655,593
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$
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772,605
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$
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5,883,003
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$
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1,494,791
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Non-GAAP net income attributable to Gilead
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$
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3,929,533
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$
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839,725
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$
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6,417,342
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$
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1,641,668
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Diluted EPS
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$
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2.20
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$
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0.46
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$
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3.52
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$
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0.89
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Non-GAAP diluted EPS
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$
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2.36
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$
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0.50
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$
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3.84
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$
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0.98
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Product Sales
Compared to the second quarter of 2013, U.S. product sales for the
second quarter of 2014 increased to $4.82 billion from $1.64 billion and
Europe product sales increased to $1.31 billion from $818.2 million.
Antiviral Product Sales
Antiviral product sales increased to $6.01 billion for the second
quarter of 2014, up from $2.31 billion for the second quarter of 2013
primarily due to sales of Sovaldi® (sofosbuvir 400 mg), which
launched in December 2013.
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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(In thousands, except percentages)
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2014
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2013
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% Change
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2014
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2013
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% Change
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Antiviral product sales
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$
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6,012,144
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$
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2,313,539
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160
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%
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$
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10,520,641
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$
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4,374,617
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140
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%
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Sovaldi
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3,480,326
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-
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-
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%
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5,754,675
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-
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-
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%
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Atripla
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870,708
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938,108
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(7)
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%
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1,650,302
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1,815,181
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(9)
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%
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Truvada
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806,610
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807,779
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-
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%
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1,566,310
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1,508,021
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4
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%
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Complera/Eviplera
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299,464
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188,683
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59
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%
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550,197
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336,872
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63
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%
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Stribild
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269,520
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99,394
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171
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%
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484,791
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191,542
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153
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%
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Viread
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260,734
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250,188
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4
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%
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471,359
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460,520
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2
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%
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Cardiovascular Product Sales
Cardiovascular product sales increased to $266.7 million for the second
quarter of 2014, compared to $234.9 million for the second quarter of
2013.
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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(In thousands, except percentages)
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2014
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2013
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% Change
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2014
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2013
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% Change
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Cardiovascular product sales
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$
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266,672
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$
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234,854
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14%
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$
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501,175
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$
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449,247
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12%
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Letairis
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144,716
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128,257
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13%
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267,601
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246,364
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9%
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Ranexa
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121,956
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106,597
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14%
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233,574
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202,883
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15%
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Operating Expenses
During the second quarter of 2014, compared to the same period in 2013:
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Non-GAAP research and development (R&D) expenses increased primarily
due to increases in headcount and other costs to support expansion of
our R&D activities.
-
Non-GAAP selling, general and administrative (SG&A) expenses increased
primarily due to headcount and marketing expense increases to support
our business expansion related to Sovaldi and pre-launch expenses for
Zydelig® (idelalisib 150 mg).
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Three Months Ended
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Six Months Ended
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June 30,
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June 30,
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(In thousands)
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2014
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2013
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2014
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2013
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Non-GAAP research and development expenses
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$
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541,974
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$
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487,771
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$
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1,099,779
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$
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947,747
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Non-GAAP selling, general and administrative expenses
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$
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569,230
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$
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376,336
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$
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1,069,335
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$
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709,400
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Note:
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Non-GAAP R&D and SG&A expenses exclude the impact of
acquisition-related, restructuring and stock-based compensation
expenses.
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Tax Rate
Our non-GAAP effective tax rate for the three and six months ended June
30, 2014 was 14.6% and 18.2%, respectively. The non-GAAP effective tax
rate for the three months ended June 30, 2014 includes a cumulative
catch up adjustment of 3.6 percentage points to the first quarter tax
rate to reduce the year to date non-GAAP effective tax rate to 18.2%.
Cash, Cash Equivalents and Marketable Securities
As of June 30, 2014, Gilead had $9.58 billion of cash, cash equivalents
and marketable securities compared to $6.86 billion as of March 31,
2014. During the second quarter of 2014, Gilead generated $4.19 billion
in operating cash flow. Gilead utilized $1.2 billion to repurchase 15.2
million shares during the quarter and has approximately $1.7 billion
remaining in the current repurchase plan which is expected to be
completed by September 2014. In May, the company announced that its
Board of Directors authorized an additional repurchase of up to $5
billion of the company's common stock following completion of the
current authorization.
Updated Full Year 2014 Guidance
Gilead updated its full year 2014 guidance, which it initially provided
on February 4, 2014 and reiterated on April 22, 2014, to include the
impact of Sovaldi product sales:
(In millions, except percentages and per share amounts)
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Initially Provided February 4, 2014; Reiterated
April 22, 2014
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Updated
July 23, 2014
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Net Product Sales
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$11,300 - $11,500
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$21,000 - $23,000
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Non-GAAP*
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Product Gross Margin
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75% - 77%
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85% - 88%
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R&D
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$2,200 - $2,300
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$2,300 - $2,400
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SG&A
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$2,100 - $2,200
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$2,300 - $2,400
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Effective Tax Rate
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28% - 29%
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17.5% - 20.5%
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Diluted EPS Impact of Acquisition-Related, Restructuring and
Stock-Based Compensation Expenses
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$0.63 - $0.66
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$0.63 - $0.66
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* Non-GAAP product gross margin, expenses and effective tax rate
exclude the impact of acquisition-related, restructuring and
stock-based compensation expenses, where applicable.
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Product & Pipeline Updates Announced by Gilead
During the Second Quarter of 2014 Include:
Antiviral Program
-
Submission of a New Drug Application (NDA) to Japan's Pharmaceutical
and Medical Devices Agency (PMDA) for approval of sofosbuvir (SOF), a
once-daily nucleotide analog polymerase inhibitor for the treatment of
chronic HCV infection. The NDA is based primarily on data from a Phase
3 clinical trial conducted in Japan among 153 treatment-naïve and
treatment-experienced genotype 2 patients. In the study, 97 percent of
HCV-infected patients receiving 12 weeks of an all-oral regimen of SOF
plus ribavirin (RBV) 600-1,000 mg/day achieved a sustained virologic
response 12 weeks after completing therapy (SVR12). If approved, SOF
would form the basis of the first all-oral, interferon-free treatment
regimen for genotype 2 patients in Japan.
-
Positive results from a Phase 3 clinical trial in Japan evaluating the
investigational once-daily fixed-dose combination of the NS5A
inhibitor ledipasvir (LDV) 90 mg and SOF 400 mg, with and without RBV,
for the treatment of genotype 1 chronic HCV infection. In the arm that
utilized LDV/SOF without RBV, 100 percent of patients treated achieved
SVR12, including the subset of patients with cirrhosis. Based on these
data, Gilead plans to submit an NDA for the LDV/SOF fixed-dose
combination with the Japanese PMDA by the end of 2014.
-
U.S. Food and Drug Administration (FDA) acceptance of the company's
refiling of two NDAs for cobicistat and elvitegravir. FDA set target
review dates under the Prescription Drug User Fee Act (PDUFA) of
October 3, 2014 for cobicistat and October 4, 2014 for elvitegravir.
-
Presentations of data on SOF-based regimens in chronic HCV patients at
the 49th Annual Meeting of the European Association for the
Study of the Liver included:
-
Positive data from two Phase 2 studies and a compassionate access
study in which a regimen containing once-daily Sovaldi was
administered for the treatment of chronic HCV infection in
patients with advanced liver disease.
-
Positive data from two Phase 2 studies, evaluating investigational
all-oral regimens containing SOF for the treatment of chronic HCV
infection.
-
Positive results from an open-label clinical trial, evaluating
once-daily Sovaldi for the retreatment of chronic HCV infection
among patients who failed prior therapy.
-
Priority review granted by the FDA of the NDA for a once-daily
fixed-dose combination of LDV/SOF for the treatment of chronic HCV
genotype 1 infection in adults. The FDA set a target action date under
PDUFA of October 10, 2014.
Oncology Program
-
Updated interim results of a Phase 2 study evaluating GS-9973,
Gilead's investigational oral inhibitor of spleen tyrosine kinase
(Syk), for the treatment of patients with relapsed chronic lymphocytic
leukemia (CLL) at the 50th Annual Meeting of the American
Society of Clinical Oncology. Based on these data, Gilead plans to
initiate new CLL study cohorts to include patients who have relapsed
following treatment with other inhibitors of the B-cell receptor
signaling pathway.
Other
-
Positive results from a placebo-controlled, Phase 2a challenge study
in healthy adult patients intranasally infected with respiratory
syncytial virus (RSV) at the American Thoracic Society 2014
International Conference. The study of GS-5806, an investigational
oral RSV fusion inhibitor, achieved its primary and secondary
endpoints of lower viral load (the amount of virus detected in the
nasal wash), improvements in total mucus weight (the amount of mucus
produced) and also symptom score compared to placebo.
-
Positive results from HARMONY, a randomized, double-blind,
placebo-controlled Phase 2 study evaluating the effect of ranolazine
and low-dose dronedarone, each given alone and in combination, on
atrial fibrillation burden (AFB) in patients with paroxysmal atrial
fibrillation at the annual meeting of the Heart Rhythm Society. In
HARMONY, the combination of ranolazine and low-dose dronedarone
provided greater reductions in AFB from baseline than either therapy
used alone.
-
Positive results from a Phase 1 clinical trial of GS-6615, an
investigational, selective late sodium current inhibitor, showing a
shortening of the QTc interval (the time interval between the start of
the Q-wave and end of the T-wave in the heart's electrical cycle) in
patients with long QT-3 (LQT3) syndrome at the annual meeting of the
Heart Rhythm Society. Based on these results, Gilead plans to initiate
a Phase 2 study of GS-6615 in LQT3 patients later this year.
Additionally, based on pre-clinical data for GS-6615 and clinical data
involving the role of late sodium current inhibition in other
cardiovascular diseases, Gilead plans to initiate Phase 2 clinical
trials in patients with hypertrophic cardiomyopathy and ventricular
tachycardia/ventricular fibrillation.
Conference Call
At 4:30 p.m. Eastern Time today, Gilead's management will host a
conference call and a simultaneous webcast to discuss results from its
second quarter 2014 as well as provide a general business update. To
access the webcast live via the internet, please connect to the
company's website at www.gilead.com
15 minutes prior to the conference call to ensure adequate time for any
software download that may be needed to hear the webcast. Alternatively,
please call 1-877-359-9508 (U.S.) or 1-224-357-2393 (international) and
dial the conference ID 65785151 to access the call.
A replay of the webcast will be archived on the company's website for
one year, and a phone replay will be available approximately two hours
following the call through July 25, 2014. To access the phone replay,
please call 1-855-859-2056 (U.S.) or 1-404-537-3406 (international) and
dial the conference ID 65785151.
About Gilead
Gilead Sciences is a biopharmaceutical company that discovers, develops
and commercializes innovative therapeutics in areas of unmet medical
need. The company's mission is to transform and simplify care for people
with life-threatening illnesses around the word. Headquartered in Foster
City, California, Gilead has operations in North and South America,
Europe and Asia-Pacific.
Non-GAAP Financial Information
Gilead has presented certain financial information in accordance with
U.S. generally accepted accounting principles (GAAP) and also on a
non-GAAP basis. Management believes this non-GAAP information is useful
for investors, when considered in conjunction with Gilead's GAAP
financial statements, because management uses such information
internally for its operating, budgeting and financial planning purposes.
Non-GAAP information is not prepared under a comprehensive set of
accounting rules and should only be used to supplement an understanding
of Gilead's operating results as reported under GAAP. A reconciliation
between GAAP and non-GAAP financial information is provided in the table
on pages 8 and 9.
Forward-looking Statements
Statements included in this press release that are not historical in
nature are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Gilead cautions readers that
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially.
These risks and uncertainties include: Gilead's ability to achieve its
anticipated full year 2014 financial results; Gilead's ability to
sustain growth in revenues for its antiviral, cardiovascular and
respiratory programs; availability of funding for state AIDS Drug
Assistance Programs (ADAPs); continued fluctuations in ADAP purchases
driven by federal and state grant cycles which may not mirror patient
demand and may cause fluctuations in Gilead's earnings; the possibility
of unfavorable results from clinical trials involving GS-9973, GS-5806,
GS-6615, sofosbuvir, including in combination with other product
candidates such as LDV; Gilead's ability to initiate clinical trials in
its currently anticipated timeframes; the levels of inventory held by
wholesalers and retailers which may cause fluctuations in Gilead's
earnings; Gilead's ability to submit NDAs for new product candidates in
the timelines currently anticipated, including the fixed dose
combination of LDV/SOF with the PDMA; Gilead's ability to receive
regulatory approvals in a timely manner or at all, for new and current
products, including sofosbuvir in Japan; the fixed-dose combination of
LDV/SOF in the United States and elvitegravir and cobicistat as single
agents in the United States; Gilead's ability to successfully
commercialize its products, including Sovaldi, Stribild, Vitekta, Tybost
and Zydelig; the risk that estimates of patients with HCV or anticipated
patient demand may not be accurate; Gilead's ability to successfully
develop its respiratory, cardiovascular, oncology and inflammation
programs; safety and efficacy data from clinical studies may not warrant
further development of Gilead's product candidates; the potential for
additional austerity measures in European countries that may increase
the amount of discount required on Gilead's products; Gilead's ability
to complete its share repurchase programs due to changes in its stock
price, corporate or other market conditions; fluctuations in the foreign
exchange rate of the U.S. dollar that may cause an unfavorable foreign
currency exchange impact on Gilead's future revenues and pre-tax
earnings; and other risks identified from time to time in Gilead's
reports filed with the U.S. Securities and Exchange Commission (SEC). In
addition, Gilead makes estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses and related
disclosures. Gilead bases its estimates on historical experience and on
various other market specific and other relevant assumptions that it
believes to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets
and liabilities that are not readily apparent from other sources. Actual
results may differ significantly from these estimates. You are urged to
consider statements that include the words may, will, would, could,
should, might, believes, estimates, projects, potential, expects, plans,
anticipates, intends, continues, forecast, designed, goal, or the
negative of those words or other comparable words to be uncertain and
forward-looking. Gilead directs readers to its press releases, Quarterly
Report on Form 10-Q for the quarter ended March 31, 2014 and other
subsequent disclosure documents filed with the SEC. Gilead claims the
protection of the Safe Harbor contained in the Private Securities
Litigation Reform Act of 1995 for forward-looking statements.
All forward-looking statements are based on information currently
available to Gilead, and Gilead assumes no obligation to update any such
forward-looking statements.
Gilead owns or has rights to various trademarks, copyrights and trade
names used in our business, including the following: GILEAD®,
GILEAD SCIENCES®, SOVALDI®, STRIBILD®,
COMPLERA®, EVIPLERA®, TRUVADA®, VIREAD®,
EMTRIVA®, TYBOST®, ZYDELIG®, HEPSERA®,
VITEKTA®, LETAIRIS®, RANEXA®, CAYSTON®,
AMBISOME®, VISTIDE®, VOLIBRIS®, and
RAPISCAN®.
ATRIPLA® is a registered trademark belonging to Bristol-Myers
Squibb & Gilead Sciences, LLC. LEXISCAN® is a
registered trademark belonging to Astellas U.S. LLC. MACUGEN®
is a registered trademark belonging to Eyetech, Inc. SUSTIVA®
is a registered trademark of Bristol-Myers Squibb Pharma Company. TAMIFLU®
is a registered trademark belonging to Hoffmann-La Roche Inc.
For more information on Gilead Sciences, Inc., please visit www.gilead.com
or call the Gilead Public Affairs Department at 1-800-GILEAD-5
(1-800-445-3235).
|
GILEAD SCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(in thousands, except per share amounts)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Product sales
|
|
$
|
6,412,937
|
|
|
$
|
2,657,285
|
|
|
$
|
11,283,911
|
|
|
$
|
5,050,853
|
|
Royalty, contract and other revenues
|
|
122,006
|
|
|
110,109
|
|
|
249,988
|
|
|
248,176
|
|
Total revenues
|
|
6,534,943
|
|
|
2,767,394
|
|
|
11,533,899
|
|
|
5,299,029
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold
|
|
924,709
|
|
|
684,663
|
|
|
1,737,914
|
|
|
1,319,111
|
|
Research and development
|
|
583,924
|
|
|
523,902
|
|
|
1,178,902
|
|
|
1,021,534
|
|
Selling, general and administrative
|
|
613,555
|
|
|
404,991
|
|
|
1,161,678
|
|
|
779,287
|
|
Total costs and expenses
|
|
2,122,188
|
|
|
1,613,556
|
|
|
4,078,494
|
|
|
3,119,932
|
|
Income from operations
|
|
4,412,755
|
|
|
1,153,838
|
|
|
7,455,405
|
|
|
2,179,097
|
|
Interest expense
|
|
(102,004
|
)
|
|
(78,008
|
)
|
|
(178,273
|
)
|
|
(159,795
|
)
|
Other income (expense), net
|
|
(3,645
|
)
|
|
(231
|
)
|
|
(21,557
|
)
|
|
(3,555
|
)
|
Income before provision for income taxes
|
|
4,307,106
|
|
|
1,075,599
|
|
|
7,255,575
|
|
|
2,015,747
|
|
Provision for income taxes
|
|
656,621
|
|
|
307,981
|
|
|
1,382,503
|
|
|
530,419
|
|
Net income
|
|
3,650,485
|
|
|
767,618
|
|
|
5,873,072
|
|
|
1,485,328
|
|
Net loss attributable to noncontrolling interest
|
|
5,108
|
|
|
4,987
|
|
|
9,931
|
|
|
9,463
|
|
Net income attributable to Gilead
|
|
$
|
3,655,593
|
|
|
$
|
772,605
|
|
|
$
|
5,883,003
|
|
|
$
|
1,494,791
|
|
Net income per share attributable to Gilead common stockholders -
basic
|
|
$
|
2.39
|
|
|
$
|
0.51
|
|
|
$
|
3.83
|
|
|
$
|
0.98
|
|
Net income per share attributable to Gilead common stockholders -
diluted
|
|
$
|
2.20
|
|
|
$
|
0.46
|
|
|
$
|
3.52
|
|
|
$
|
0.89
|
|
Shares used in per share calculation - basic
|
|
1,532,723
|
|
|
1,526,945
|
|
|
1,534,614
|
|
|
1,524,174
|
|
Shares used in per share calculation - diluted
|
|
1,664,415
|
|
|
1,694,577
|
|
|
1,672,435
|
|
|
1,683,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GILEAD SCIENCES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
(unaudited)
(in thousands, except percentages and per share amounts)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
|
Cost of goods sold reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP cost of goods sold
|
|
$
|
924,709
|
|
|
$
|
684,663
|
|
|
$
|
1,737,914
|
|
|
$
|
1,319,111
|
|
Stock-based compensation expenses
|
|
(2,565
|
)
|
|
(2,632
|
)
|
|
(5,207
|
)
|
|
(4,473
|
)
|
Acquisition related-amortization of purchased intangibles
|
|
(199,230
|
)
|
|
(21,264
|
)
|
|
(398,460
|
)
|
|
(42,528
|
)
|
Non-GAAP cost of goods sold
|
|
$
|
722,914
|
|
|
$
|
660,767
|
|
|
$
|
1,334,247
|
|
|
$
|
1,272,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product gross margin reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP product gross margin
|
|
85.6
|
%
|
|
74.2
|
%
|
|
84.6
|
%
|
|
73.9
|
%
|
Stock-based compensation expenses
|
|
0.0
|
%
|
|
0.1
|
%
|
|
0.0
|
%
|
|
0.1
|
%
|
Acquisition related-amortization of purchased intangibles
|
|
3.1
|
%
|
|
0.8
|
%
|
|
3.5
|
%
|
|
0.8
|
%
|
Non-GAAP product gross margin(1)
|
|
88.7
|
%
|
|
75.1
|
%
|
|
88.2
|
%
|
|
74.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP research and development expenses
|
|
$
|
583,924
|
|
|
$
|
523,902
|
|
|
$
|
1,178,902
|
|
|
$
|
1,021,534
|
|
Stock-based compensation expenses
|
|
(36,633
|
)
|
|
(24,646
|
)
|
|
(70,983
|
)
|
|
(51,521
|
)
|
Restructuring expenses
|
|
(29
|
)
|
|
(67
|
)
|
|
(174
|
)
|
|
(4,824
|
)
|
Acquisition related-contingent consideration remeasurement
|
|
(5,288
|
)
|
|
(11,418
|
)
|
|
(7,966
|
)
|
|
(17,442
|
)
|
Non-GAAP research and development expenses
|
|
$
|
541,974
|
|
|
$
|
487,771
|
|
|
$
|
1,099,779
|
|
|
$
|
947,747
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP selling, general and administrative expenses
|
|
$
|
613,555
|
|
|
$
|
404,991
|
|
|
$
|
1,161,678
|
|
|
$
|
779,287
|
|
Stock-based compensation expenses
|
|
(43,935
|
)
|
|
(28,675
|
)
|
|
(89,168
|
)
|
|
(61,726
|
)
|
Restructuring expenses
|
|
(2
|
)
|
|
306
|
|
|
(5
|
)
|
|
(438
|
)
|
Acquisition related-transaction costs
|
|
(107
|
)
|
|
(4
|
)
|
|
(555
|
)
|
|
(7,160
|
)
|
Acquisition related-amortization of purchased intangibles
|
|
(281
|
)
|
|
(282
|
)
|
|
(2,615
|
)
|
|
(563
|
)
|
Non-GAAP selling, general and administrative expenses
|
|
$
|
569,230
|
|
|
$
|
376,336
|
|
|
$
|
1,069,335
|
|
|
$
|
709,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating margin reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating margin
|
|
67.5
|
%
|
|
41.7
|
%
|
|
64.6
|
%
|
|
41.1
|
%
|
Stock-based compensation expenses
|
|
1.3
|
%
|
|
2.0
|
%
|
|
1.4
|
%
|
|
2.2
|
%
|
Restructuring expenses
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.1
|
%
|
Acquisition related-transaction costs
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.1
|
%
|
Acquisition related-amortization of purchased intangibles
|
|
3.1
|
%
|
|
0.8
|
%
|
|
3.5
|
%
|
|
0.8
|
%
|
Acquisition related-contingent consideration remeasurement
|
|
0.1
|
%
|
|
0.4
|
%
|
|
0.1
|
%
|
|
0.3
|
%
|
Non-GAAP operating margin(1)
|
|
71.9
|
%
|
|
44.9
|
%
|
|
69.6
|
%
|
|
44.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense) reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP other income (expense), net
|
|
$
|
(3,645
|
)
|
|
$
|
(231
|
)
|
|
$
|
(21,557
|
)
|
|
$
|
(3,555
|
)
|
Acquisition related-transaction costs
|
|
2
|
|
|
-
|
|
|
(1,851
|
)
|
|
-
|
|
Non-GAAP other income (expense), net
|
|
$
|
(3,643
|
)
|
|
$
|
(231
|
)
|
|
$
|
(23,408
|
)
|
|
$
|
(3,555
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GILEAD SCIENCES, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION -
(Continued)
(unaudited)
(in thousands, except percentages and per share amounts)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013
|
|
Effective tax rate reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP effective tax rate
|
|
15.2
|
%
|
|
28.6
|
%
|
|
19.1
|
%
|
|
26.3
|
%
|
Restructuring expenses
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
(0.1
|
)%
|
Acquisition related-amortization of purchased intangibles
|
|
(0.6
|
)%
|
|
0.0
|
%
|
|
(0.9
|
)%
|
|
0.0
|
%
|
Acquisition related-contingent consideration remeasurement
|
|
0.0
|
%
|
|
(0.3
|
)%
|
|
0.0
|
%
|
|
(0.2
|
)%
|
Non-GAAP effective tax rate(1)
|
|
14.6
|
%
|
|
28.3
|
%
|
|
18.2
|
%
|
|
26.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to Gilead reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income attributable to Gilead, net of tax
|
|
$
|
3,655,593
|
|
|
$
|
772,605
|
|
|
$
|
5,883,003
|
|
|
$
|
1,494,791
|
|
Stock-based compensation expenses
|
|
72,199
|
|
|
40,379
|
|
|
135,335
|
|
|
85,759
|
|
Restructuring expenses
|
|
25
|
|
|
(244
|
)
|
|
173
|
|
|
5,124
|
|
Acquisition related-transaction costs
|
|
109
|
|
|
4
|
|
|
(866
|
)
|
|
7,160
|
|
Acquisition related-amortization of purchased intangibles
|
|
196,319
|
|
|
15,563
|
|
|
391,731
|
|
|
31,392
|
|
Acquisition related-contingent consideration remeasurement
|
|
5,288
|
|
|
11,418
|
|
|
7,966
|
|
|
17,442
|
|
Non-GAAP net income attributable to Gilead, net of tax
|
|
$
|
3,929,533
|
|
|
$
|
839,725
|
|
|
$
|
6,417,342
|
|
|
$
|
1,641,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted earnings per share
|
|
$
|
2.20
|
|
|
$
|
0.46
|
|
|
$
|
3.52
|
|
|
$
|
0.89
|
|
Stock-based compensation expenses
|
|
0.04
|
|
|
0.02
|
|
|
0.08
|
|
|
0.05
|
|
Restructuring expenses
|
|
0.00
|
|
|
(0.00
|
)
|
|
0.00
|
|
|
0.00
|
|
Acquisition related-transaction costs
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
|
0.00
|
|
Acquisition related-amortization of purchased intangibles
|
|
0.12
|
|
|
0.01
|
|
|
0.23
|
|
|
0.02
|
|
Acquisition related-contingent consideration remeasurement
|
|
0.00
|
|
|
0.01
|
|
|
0.00
|
|
|
0.01
|
|
Non-GAAP diluted earnings per share(1)
|
|
$
|
2.36
|
|
|
$
|
0.50
|
|
|
$
|
3.84
|
|
|
$
|
0.98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share calculation (diluted) reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP shares used in per share calculation (diluted)
|
|
1,664,415
|
|
|
1,694,577
|
|
|
1,672,435
|
|
|
1,683,269
|
|
Share impact of current stock-based compensation rules
|
|
(965
|
)
|
|
(1,228
|
)
|
|
(950
|
)
|
|
(1,453
|
)
|
Non-GAAP shares used in per share calculation (diluted)
|
|
1,663,450
|
|
|
1,693,349
|
|
|
1,671,485
|
|
|
1,681,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustment summary:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold adjustments
|
|
$
|
201,795
|
|
|
$
|
23,896
|
|
|
$
|
403,667
|
|
|
$
|
47,001
|
|
Research and development expenses adjustments
|
|
41,950
|
|
|
36,131
|
|
|
79,123
|
|
|
73,787
|
|
Selling, general and administrative expenses adjustments
|
|
44,325
|
|
|
28,655
|
|
|
92,343
|
|
|
69,887
|
|
Other income (expense) adjustments
|
|
2
|
|
|
-
|
|
|
(1,851
|
)
|
|
-
|
|
Total non-GAAP adjustments before tax
|
|
288,072
|
|
|
88,682
|
|
|
573,282
|
|
|
190,675
|
|
Income tax effect
|
|
(14,132
|
)
|
|
(21,562
|
)
|
|
(38,943
|
)
|
|
(43,798
|
)
|
Total non-GAAP adjustments after tax
|
|
$
|
273,940
|
|
|
$
|
67,120
|
|
|
$
|
534,339
|
|
|
$
|
146,877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Amounts may not sum due to rounding.
|
|
GILEAD SCIENCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
2014
|
|
2013(1)
|
|
|
(unaudited)
|
|
|
Cash, cash equivalents and marketable securities
|
|
$
|
9,581,383
|
|
|
$
|
2,570,590
|
Accounts receivable, net
|
|
3,436,711
|
|
|
2,100,286
|
Inventories
|
|
2,068,753
|
|
|
2,055,788
|
Property, plant and equipment, net
|
|
1,380,776
|
|
|
1,166,181
|
Intangible assets, net
|
|
11,508,319
|
|
|
11,900,106
|
Goodwill
|
|
1,171,561
|
|
|
1,169,023
|
Other assets
|
|
2,058,661
|
|
|
1,534,811
|
Total assets
|
|
$
|
31,206,164
|
|
|
$
|
22,496,785
|
|
|
|
|
|
|
Current liabilities
|
|
$
|
6,227,997
|
|
|
$
|
6,325,421
|
Long-term liabilities
|
|
8,512,950
|
|
|
4,363,032
|
Equity component of currently redeemable convertible notes
|
|
35,875
|
|
|
63,831
|
Stockholders' equity(2)
|
|
16,429,342
|
|
|
11,744,501
|
Total liabilities and stockholders' equity
|
|
$
|
31,206,164
|
|
|
$
|
22,496,785
|
(1) Derived from the audited consolidated financial
statements as of December 31, 2013.
|
(2) As of June 30, 2014, there were 1,526,043 shares of
common stock issued and outstanding.
|
|
GILEAD SCIENCES, INC.
PRODUCT SALES SUMMARY
(unaudited)
(in thousands)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Antiviral products:
|
|
|
|
|
|
|
|
|
|
|
|
Sovaldi - U.S.
|
|
$
|
3,031,507
|
|
|
$
|
-
|
|
|
$
|
5,129,298
|
|
|
$
|
-
|
Sovaldi - Europe
|
|
400,218
|
|
|
-
|
|
|
563,909
|
|
|
-
|
Sovaldi - Other International
|
|
48,601
|
|
|
-
|
|
|
61,468
|
|
|
-
|
|
|
3,480,326
|
|
|
-
|
|
|
5,754,675
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Atripla - U.S.
|
|
578,349
|
|
|
611,330
|
|
|
1,068,278
|
|
|
1,165,156
|
Atripla - Europe
|
|
234,328
|
|
|
270,780
|
|
|
470,836
|
|
|
548,995
|
Atripla - Other International
|
|
58,031
|
|
|
55,998
|
|
|
111,188
|
|
|
101,030
|
|
|
870,708
|
|
|
938,108
|
|
|
1,650,302
|
|
|
1,815,181
|
|
|
|
|
|
|
|
|
|
|
|
|
Truvada - U.S.
|
|
399,570
|
|
|
415,541
|
|
|
767,352
|
|
|
723,402
|
Truvada - Europe
|
|
337,981
|
|
|
324,992
|
|
|
661,167
|
|
|
657,019
|
Truvada - Other International
|
|
69,059
|
|
|
67,246
|
|
|
137,791
|
|
|
127,600
|
|
|
806,610
|
|
|
807,779
|
|
|
1,566,310
|
|
|
1,508,021
|
|
|
|
|
|
|
|
|
|
|
|
|
Complera / Eviplera - U.S.
|
|
153,846
|
|
|
120,187
|
|
|
284,272
|
|
|
223,484
|
Complera / Eviplera - Europe
|
|
132,132
|
|
|
59,301
|
|
|
241,126
|
|
|
98,263
|
Complera / Eviplera - Other International
|
|
13,486
|
|
|
9,195
|
|
|
24,799
|
|
|
15,125
|
|
|
299,464
|
|
|
188,683
|
|
|
550,197
|
|
|
336,872
|
|
|
|
|
|
|
|
|
|
|
|
|
Stribild - U.S.
|
|
229,417
|
|
|
96,961
|
|
|
416,507
|
|
|
188,939
|
Stribild - Europe
|
|
31,308
|
|
|
1,848
|
|
|
54,938
|
|
|
1,848
|
Stribild - Other International
|
|
8,795
|
|
|
585
|
|
|
13,346
|
|
|
755
|
|
|
269,520
|
|
|
99,394
|
|
|
484,791
|
|
|
191,542
|
|
|
|
|
|
|
|
|
|
|
|
|
Viread - U.S.
|
|
116,554
|
|
|
113,965
|
|
|
197,607
|
|
|
196,593
|
Viread - Europe
|
|
87,591
|
|
|
88,042
|
|
|
171,656
|
|
|
176,248
|
Viread - Other International
|
|
56,589
|
|
|
48,181
|
|
|
102,096
|
|
|
87,679
|
|
|
260,734
|
|
|
250,188
|
|
|
471,359
|
|
|
460,520
|
|
|
|
|
|
|
|
|
|
|
|
|
LDV/SOF - Europe
|
|
439
|
|
|
-
|
|
|
439
|
|
|
-
|
|
|
439
|
|
|
-
|
|
|
439
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Antiviral - U.S.
|
|
13,445
|
|
|
15,931
|
|
|
20,491
|
|
|
33,410
|
Other Antiviral - Europe
|
|
9,027
|
|
|
10,852
|
|
|
18,306
|
|
|
23,826
|
Other Antiviral - Other International
|
|
1,871
|
|
|
2,604
|
|
|
3,771
|
|
|
5,245
|
|
|
24,343
|
|
|
29,387
|
|
|
42,568
|
|
|
62,481
|
|
|
|
|
|
|
|
|
|
|
|
|
Total antiviral products - U.S.
|
|
4,522,688
|
|
|
1,373,915
|
|
|
7,883,805
|
|
|
2,530,984
|
Total antiviral products - Europe
|
|
1,233,024
|
|
|
755,815
|
|
|
2,182,377
|
|
|
1,506,199
|
Total antiviral products - Other International
|
|
256,432
|
|
|
183,809
|
|
|
454,459
|
|
|
337,434
|
|
|
6,012,144
|
|
|
2,313,539
|
|
|
10,520,641
|
|
|
4,374,617
|
|
|
|
|
|
|
|
|
|
|
|
|
Letairis
|
|
144,716
|
|
|
128,257
|
|
|
267,601
|
|
|
246,364
|
Ranexa
|
|
121,956
|
|
|
106,597
|
|
|
233,574
|
|
|
202,883
|
AmBisome
|
|
94,794
|
|
|
75,137
|
|
|
186,887
|
|
|
160,412
|
Other products
|
|
39,327
|
|
|
33,755
|
|
|
75,208
|
|
|
66,577
|
|
|
400,793
|
|
|
343,746
|
|
|
763,270
|
|
|
676,236
|
|
|
|
|
|
|
|
|
|
|
|
|
Total product sales
|
|
$
|
6,412,937
|
|
|
$
|
2,657,285
|
|
|
$
|
11,283,911
|
|
|
$
|
5,050,853
|
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