Taro Provides Results for Year Ended March 31, 2024

Taro Pharmaceutical Industries Ltd. provided unaudited financial results for the quarter and year ended March 31, 2024.

HAWTHORNE, N.Y.--(BUSINESS WIRE)-- Taro Pharmaceutical Industries Ltd. (NYSE: TARO) (“Taro” or the “Company”) today provided unaudited financial results for the quarter and year ended March 31, 2024.

Quarter ended March 31, 2024 Highlights ─ compared to March 31, 2023

  • Net sales of $164.9 million increased $18.4 million, or 12.5%, principally due to new launches and gross-to-net (“GTN”) adjustments. Excluding the impact of GTN adjustments, sales growth was high single digits.
  • Gross profit of $87.4 million (53.0% of net sales) compared to $75.7 million (51.6% of net sales).
  • Research and development (R&D) expenses of $20.5 million increased $4.2 million.
  • Selling, marketing, general and administrative expenses (SG&A) of $58.1 million included certain one-time charges of $1 million related to the Special Committee that was established by the Board to consider the proposal submitted by Sun Pharmaceutical Industries Ltd. on May 26, 2023. Excluding these charges, SG&A increased $7.0 million.
  • Operating income was $ 8.8 million; excluding the impact from the GTN adjustments and the certain one-time charges for the quarter, the decline in the operating income was even higher.
  • Interest and other financial income of $15.8 million increased $7.8 million.
  • Tax expense of $11.2 million compared to a tax expense of $11.0 million.
  • Net income attributable to Taro was $15.1 million compared to net income of $6.9 million, resulting in earnings per share of $0.40 compared to earnings per share of $0.18. Excluding the impact from the certain one-time charges, net income was $16.1 million, resulting in diluted earnings per share of $0.43.

Year ended March 31, 2024 Highlights ─ compared to March 31, 2023

  • Net sales of $629.2 million increased $56.2 million or 9.8%, principally due to new launches and one-time GTN adjustments. Excluding these adjustments, the sales growth was mid-single-digits.
  • Gross profit of $305.0 million (48.5% of net sales compared to 46.8%) increased $36.6 million.
  • R&D expenses of $64.5 million increased $12.3 million.
  • SG&A of $219.0 million included certain one-time charges of $14.2 million related to the aforementioned certain one-time charges and transitional expenses for the relocation of our Alchemee operations from California to New York. Excluding these charges, SG&A was $204.7 million, increased 3.2% above the prior year.
  • Operating income was $21.5 million; excluding the impact from the GTN adjustments and the certain one-time charges during the current year, the resulting operating income was lower than the previous year.
  • Interest and other financial income of $56.2 million increased $35.3 million from $20.9 million.
  • Tax expense of $28.8 million compared to tax expense of $12.8 million, an increase of $16.0 million.
  • Net income attributable to Taro was $53.9 million compared to $25.4 million, resulting in earnings per share of $1.43 compared to earnings per share of $0.68. Excluding the impact from the certain one-time charges, net income was $66.3 million, resulting in diluted earnings per share of $1.77.

Cash Flow and Balance Sheet Highlights

  • Cash flow provided by operations for the year ended March 31, 2024 was $124.6 million compared to $31.8 million for the year ended March 31, 2023. Excluding the impact from certain one-time charges impacting both years, cash flow provided by operations was $137.0 million compared to $99.0 million for the year ended March 31, 2023.
  • As of March 31, 2024, cash and cash equivalents, short-term bank deposits and marketable securities (both short- and long-term) was $1.3 billion, or $82.2 million more than March 31, 2023.

The Company cautions that the foregoing 2024 financial information is unaudited and is subject to change.

************************

About Taro

Taro Pharmaceutical Industries Ltd. is a multinational, science-based pharmaceutical company dedicated to meeting the needs of its customers through the discovery, development, manufacturing and marketing of the highest quality healthcare products. For further information on Taro Pharmaceutical Industries Ltd., please visit the Company’s website at www.taro.com.

SAFE HARBOR STATEMENT

The unaudited consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements, and, in the opinion of management, reflect all adjustments necessary to present fairly the financial condition and results of operations of the Company. The unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 20-F, as filed with the SEC.

Certain statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements that do not describe historical facts or that refer or relate to events or circumstances the Company “estimates,” “believes,” or “expects” to happen or similar language, and statements with respect to the Company’s financial performance, availability of financial information, and estimates of financial results and information for fiscal year 2025. Although the Company believes the expectations reflected in such forward-looking statements to be based on reasonable assumptions, it can give no assurances that its expectations will be attained. Factors that could cause actual results to differ include general domestic and international economic conditions, industry and market conditions, changes in the Company's financial position, litigation brought by any party in any court in Israel, the United States, or any country in which Taro operates, regulatory and legislative actions in the countries in which Taro operates, and other risks detailed from time to time in the Company’s SEC reports, including its Annual Reports on Form 20-F. Forward-looking statements are applicable only as of the date on which they are made. The Company undertakes no obligations to update, change or revise any forward-looking statement, whether as a result of new information, additional or subsequent developments or otherwise.

**Financial Tables Follow**

TARO PHARMACEUTICAL INDUSTRIES LTD.
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except share data)
               
  Quarter Ended   Twelve Months Ended
  March 31,   March 31,
   

2024

     

2023

     

2024

     

2023

 
Sales, net

$

164,941

   

$

146,587

   

$

629,182

   

$

572,952

 
Cost of sales  

77,552

     

70,879

     

324,203

     

304,629

 
Impairment  

     

     

23

     

 
Gross profit  

87,389

     

75,708

     

304,956

     

268,323

 
               
Operating Expenses:              
Research and development  

20,478

     

16,306

     

64,536

     

52,243

 
Selling, marketing, general and administrative  

58,127

     

50,128

     

218,935

     

198,366

 
Operating income *  

8,784

     

9,274

     

21,485

     

17,714

 
               
Financial (income)/expense, net:              
Interest and other financial income  

(15,834

)

   

(8,036

)

   

(56,192

)

   

(20,850

)

Foreign exchange expense/(income)  

588

     

469

     

(9

)

   

2,813

 
Other gain, net  

2,198

     

1,059

     

4,981

     

2,462

 
Income before income taxes  

26,228

     

17,900

     

82,668

     

38,213

 
Tax expense  

11,150

     

10,987

     

28,801

     

12,768

 
Net income *

$

15,078

   

$

6,913

   

$

53,867

   

$

25,445

 
               
Net income/ per ordinary share:              
Basic and Diluted *

$

0.40

   

$

0.18

   

$

1.43

   

$

0.68

 
               
Weighted-average number of shares used to compute net income per share:              
Basic and Diluted  

37,584,891

     

37,584,891

     

37,584,891

     

37,584,891

 
               
May not foot due to rounding.              

* For the quarter ended March 31, 2024, excluding the impact from the certain one-time charges of $1.0 million (see page one of release for a description), operating income was $9.8 million. compared to operating income of $8.8 million. Excluding the impact of the certain one-time charges, net income was $16.1 million, resulting in earnings per share of $0.43.

* For the full year ended March 31, 2024, excluding the impact from the certain one-time charges of $14.2 million (see page one of release for a description), operating income was $35.7 million compared to $21.5 million. Excluding the impact of the certain one-time charges, net income was $66.3 million, resulting in earnings per share of $1.77.

TARO PHARMACEUTICAL INDUSTRIES LTD.
SUMMARY CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands)
         
    March 31,   March 31,
   

2024

 

2023

ASSETS   (unaudited)   (audited)
CURRENT ASSETS:        
Cash and cash equivalents  

$

362,909

 

$

154,495

Short-term bank deposits    

58,947

   

119,980

Marketable securities    

457,495

   

575,814

Accounts receivable and other:        
Trade, net    

177,463

   

202,260

Other receivables and prepaid expenses    

41,772

   

57,210

Inventories    

204,817

   

226,669

TOTAL CURRENT ASSETS    

1,303,403

   

1,336,428

Marketable securities    

457,991

   

404,896

Property, plant and equipment, net    

217,592

   

190,139

Deferred income taxes    

83,397

   

103,672

Goodwill    

17,231

   

17,231

Other assets    

82,455

   

83,147

TOTAL ASSETS  

$

2,162,069

 

$

2,135,513

         
LIABILITIES AND SHAREHOLDERS' EQUITY        
CURRENT LIABILITIES:        
Trade payables  

$

44,664

 

$

68,484

Other current liabilities    

316,443

   

317,064

TOTAL CURRENT LIABILITIES    

361,107

   

385,548

Deferred taxes and other long-term liabilities    

7,956

   

19,106

TOTAL LIABILITIES    

369,063

   

404,654

         
Taro shareholders' equity    

1,793,006

   

1,730,859

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY  

$

2,162,069

 

$

2,135,513

         
TARO PHARMACEUTICAL INDUSTRIES LTD.
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands)
         
    Twelve Months Ended March 31,
     

2024

     

2023

 
Cash flows from operating activities:        
Net income  

$

53,867

   

$

25,445

 
Adjustments required to reconcile net income (loss) to net cash used in operating activities:        
Depreciation and amortization    

31,094

     

32,127

 
Impairment of long-lived assets    

23

     

 
Realized loss on sale of long-lived assets    

     

136

 
Change in derivative instruments, net    

     

(24

)

Adjustments to opening balance sheet (PPA)    

     

(15,292

)

Decrease in goodwill and intangible assets    

242

     

 
Effect of change in exchange rate on marketable securities and bank deposits    

(86

)

   

2,291

 
Deferred income taxes, net    

19,148

     

16,802

 
Decrease in trade receivables, net    

24,481

     

37,482

 
Decrease (increase) in inventories, net    

21,728

     

(16,922

)

Decrease in other receivables, income tax receivables, prepaid expenses and other    

15,730

     

2,240

 
Decrease in trade, income tax, accrued expenses and other payables    

(33,839

)

   

(60,707

)

(Income)/expense from amortization of marketable securities bonds, net    

(7,833

)

   

8,172

 
Net cash provided by operating activities    

124,555

     

31,750

 
         
Cash flows from investing activities:        
Purchase of plant, property & equipment, net    

(53,971

)

   

(17,553

)

Investment in other intangible assets    

(247

)

   

(294

)

Proceeds from (Investment in) short-term bank deposits, net    

58,338

     

(72,394

)

Proceeds from (Investment in) marketable securities, net    

81,723

     

(33,315

)

Investment in other investments    

(1,500

)

   

(2,000

)

Net cash provided by (used in) investing activities    

84,343

     

(125,556

)

         
         
Effect of exchange rate changes on cash and cash equivalents    

(483

)

   

(2,833

)

Increase (decrease) in cash and cash equivalents    

208,415

     

(96,639

)

Cash and cash equivalents at beginning of period    

154,495

     

251,134

 
Cash and cash equivalents at end of period  

$

362,910

   

$

154,495

 
         
Cash Paid during the year for:        
Income taxes  

$

18,309

   

$

4,175

 
Cash Received during the year for:        
Income taxes  

$

12,931

   

$

14,156

 
Non-cash investing transactions:        
Purchase of property, plant and equipment included in accounts payable  

$

2,041

   

$

1,242

 
Non-cash financing transactions:        
Purchase of marketable securities, net  

$

4,602

   

$

3,038

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240520647281/en/

Contacts

William J. Coote
VP, CFO
(914) 345-9001
William.Coote@taro.com

Source: Taro Pharmaceutical Industries Ltd.

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