Teva Pharmaceutical Industries Reports Remarkable Turnaround with Annual Revenue Growth

Teva Pharmaceutical Industries, a leading pharmaceutical giant, has announced a notable annual revenue growth of 6.2% for 2023, bringing in a total of $15.8 billion. After enduring five consecutive years of decline, this resurgence is attributed to a substantial advance payment of $500 million received from Snoopy Pharmaceuticals as part of a collaborative effort on an innovative anti-TL1A drug.

The fourth quarter of 2023 proved to be a particularly strong period for Teva, reporting revenues of $4.457 billion—a 14% increase compared to the same quarter in the previous year. This exceeded analysts' expectations, which were set at $4.02 billion.

The company's operational performance demonstrated a remarkable turnaround, shifting from an operating loss of $940 million and a loss rate of 24.2% in the corresponding quarter of the previous year to an operating profit of $755 million, with a profitability rate of 17% of revenues.

One significant factor contributing to the improved results was the absence of a large one-time provision related to legal matters, which had led to a deep loss in the previous year. Consequently, Teva achieved a net profit of $461 million or 41 cents per share in the fourth quarter, compared to a net loss of $1.301 billion or $1.17 per share in the corresponding quarter.

EBITDA for the quarter marked a 34% improvement, reaching $1.660 billion compared to $1.240 billion in the corresponding quarter. Adjusted profit per share stood at $1, surpassing analysts' expectations of 77 cents per share.

Simultaneously, Teva announced its intention to sell its international Active Pharmaceutical Ingredients (API) division, TAPI, responsible for supplying active ingredients to the pharmaceutical industry. The sale, scheduled to conclude in the first half of 2025, aligns with Teva's new growth strategy. According to Richard Francis, Teva's president and CEO, this move will allow the company to sharpen its focus on the core business, positioning its backlog of generic products and the diverse portfolio of generic drugs.

The sale of TAPI is anticipated to strengthen Teva's position in the global API market, estimated at $85 billion.

Teva's overall performance for the year 2023 showcased an operating profit of $433 million, a notable improvement compared to the previous year's operating loss of $2.2 billion, primarily attributed to reputation devaluation and legal settlements, including the opioid case in the US.

Ending the year with a financial debt of $19.8 billion and a cash reserve of $3.2 billion, Teva successfully reduced its net debt to $16.6 billion from $18.4 billion at the end of 2022.

Looking ahead, Teva forecasts revenues for 2024 in the range of $15.7 billion to $16.3 billion, with a modest 1% growth compared to 2023. The free cash flow for 2024 is expected to be in the range of $1.7 billion to $2 billion, reflecting a decrease from the $2.4 billion recorded in 2023.

Teva's remarkable recovery and strategic moves position the company for renewed growth and stability in the pharmaceutical industry.