Elanco Q2 2023 Earnings Report
Key Takeaways
Elanco Animal Health reported a 10% decrease in revenue to $1,057 million for Q2 2023, impacted by the ERP system integration. Despite this, the company raised its full-year guidance for revenue, adjusted EBITDA, and adjusted EPS, driven by strong performance in U.S. Pet Health and International Farm Animal businesses.
Elanco exceeded expectations for the second quarter and first half of 2023.
The company is on track to return to revenue growth in the second half and raise full year guidance for revenue, adjusted EBITDA and adjusted EPS.
Elanco advanced key drivers of its strategic Innovation, Pipeline, and Portfolio framework.
The company expects the FDA will have all data necessary to approve differentiated JAK inhibitor for canine dermatology, differentiated broad spectrum parasiticide for dogs, and Bovaer.
Elanco
Elanco
Forward Guidance
Elanco is raising its full year 2023 guidance for revenue, adjusted EBITDA and adjusted earnings per share.
Positive Outlook
- Raised revenue guidance driven by increased expectations for U.S. Pet Health
- Raised revenue guidance driven by increased expectations for poultry
- Raised revenue guidance driven by increased expectations for aqua
- Improved expectations on interest expense
- Improved expectations on tax
Challenges Ahead
- Lowered expectations for U.S. Farm Animal revenue.
- Lowered expectations for contract manufacturing revenue.
- Impact of foreign exchange on revenue is now expected to be a headwind of approximately $25 million to $30 million.
- Overperformance in the second quarter is expected to be offset in the second half of the year by gross margin pressure from expected sales mix and reduced plant utilization to decrease balance sheet inventory
- Increased investment in Pet Health to drive portfolio momentum and support launch preparations.