By Rob Curran
Elanco Animal Health posted a significantly wider third-quarter loss as a hefty goodwill charge offset revenue growth.
The Greenfield, Ind.-based developer and manufacturer of pet and farm-animal medicines posted a net loss of $1.1 billion, or $2.22 a share, for the quarter ended in September, wider than the loss of $65 million, or 13 cents a share, a year earlier. Excluding certain one-off items such as the goodwill impairment charge of $1.04 billion, the veterinarian supplies firm said adjusted earnings amounted to 18 cents a share, handily beating the average analyst estimate of 12 cents a share, as tallied by FactSet.
Elanco said it undertook an appraisal of its goodwill value in light of rising Treasury yields, and the goodwill charge largely reflected the impact of the increase in Treasury yields. Elanco purchased Bayer Animal Health in 2020 for $6.89 billion. The total market capitalization of Elanco is now around $4.73 billion.
Third-quarter revenue rose 4% to $1.07 billion, topping the mean Wall Street estimate of $1.04 billion, as per FactSet. Sales rose in both the pet and farm-animal health categories.
“Business execution paired with company-wide efforts to manage balance sheet inventory and improve working capital are leading to increased cash flow generation,” said Executive Vice President and Chief Financial Officer Todd Young, in a statement.
A boom in pet products appears to have carried through from the pandemic era, with vet supplier Idexx Laboratories among those posting solid growth in recent quarters.
Write to Rob Curran at [email protected]
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