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Viatris Q2 sales down 3%; terms results better than expectations; declares 12 cent dividends

MORGANTOWN — Viatris saw its second quarter net sales down 3% from the same period last year, but called the results strong and better than expectations.

Net sales were $4.105 billion for the quarter of April 1-June 30, compared to $4.562 billion for the same period last year.

Developed Market sales were $2.479 compared to $2.64 billion last year. Viatris noted growth or loss in terms of “operational change,” based on fluctuations in currency exchange rates; accordingly, this was a 1% increase. Emerging Markets fell 19%, from $870 million last year to $651 million this year.

JANZ — Japan, Australia, New Zealand — fell by 2%, from $501 million to $427 million. Greater China sales were $548.3 million compared to $550.3 million last year — again, an operational increase of 1%.

Viatris summarized the currency issue: “The decrease in net sales was primarily driven by the unfavorable impact of foreign currency translation of approximately $305.7 million, or 7%, primarily reflecting changes in the U.S. dollar as compared to the currencies of subsidiaries in countries within the EU and Japan.

On a constant currency basis, Viatris said, the decrease in net sales was about $150.6 million, or 3%. The decrease was due to competition on certain key U.S. products, representing a decline of about $70 million and about $164 million as a result of other base business erosion. The decrease in net sales from existing products was partially offset by about $83.8 million of new product sales.

The board of directors reported a 12 cent per share dividend for stockholders.

Because of continued strong growth of the dollar, which affects foreign exchange rates, Viatris revised its revenue guidance for the year downward. It was $17 billion to $17.5 billion previously; now, it’s $16.2 to $16.7 billion.

CEO Michael Goettler said: “We are hitting on all cylinders operationally, even while foreign exchange rates continue to be challenging, and have now demonstrated six consecutive quarters of strong performance. We continue to deliver on our financial and strategic commitments and are making good progress on all the reshaping initiatives announced in February.”

Viatris saw a quarterly profit of $1.703 billion, up from $1.328 billion last year. It paid down about $1.5 billion of debt in the first half of the year and said it’s on target to reach $2 billion by year’s end. It anticipates new product revenue of $600 million for the year.

Sales of branded products were $2.483 billion, down 1% from last year. Complex generics and biosimilars were up 11%, at $354.8 million. Sales of generics fell 1%, coming in at $1.268 billion.

Among its branded products, Lipitor (for cholesterol), EpiPen, Celebrex (for arthritis pain), Dymista (nasal spray) and Yupelri (inhaler for COPD) saw increased sales.

Norvasc (for blood pressure), Lyrica (for nerve pain), Viagra, Effexor and Zoloft (both for depression and anxiety) and Xanax (for anxiety and panic disorder) all saw sales decreases.

For the first half of the year, Viatris saw a 2% revenue drop compared to last year: $8.284 billion this year compared to 2021. Developed markets sales were even, accounting for currency fluctuations: $4.955 billion this year; $5.212 billion last year.

JANZ fell 3%: $851 million compared to $983 million. Greater China fell 2%: $1.121 billion compared to $1.142 billion.

TWEET David Beard @dbeardtdp