Zoetis Reports Q1 2024 Results

Zoetis Inc., a global leader in animal health, has reported its financial performance for the first quarter of 2024, showcasing substantial growth and updating its revenue guidance for the full year. The company posted a revenue of $2.2 billion for the first quarter, reflecting a 10% increase compared to the same period in 2023. This rise was attributed to a 12% operational growth. Net income for the quarter stood at $599 million, or $1.31 per diluted share, marking a 9% and 10% increase, respectively.

The adjusted net income for the quarter was reported at $634 million, or $1.38 per diluted share, representing a 4% and 5% rise on a reported basis, and a 15% and 17% increase operationally. This adjusted figure excludes the net impact of $35 million related to purchase accounting adjustments, acquisition-related expenses, and other significant items.

Kristin Peck, CEO of Zoetis, praised the company's performance, highlighting the 16% revenue growth in the U.S. and 8% operational growth internationally. The companion animal segment showed remarkable growth of 20% operationally, driven by innovative products in pet parasiticides, osteoarthritis pain management, and dermatology. Peck emphasized Zoetis' commitment to ongoing investment in talent, research, and capabilities to sustain future growth.

Zoetis operates through two main segments: the United States and International. In the U.S., the company reported a revenue of $1.2 billion for the first quarter, a 16% increase from the previous year. Sales of companion animal products surged by 25%, driven by key products like Simparica Trio®, Apoquel®, Cytopoint®, Librela® for dogs, and Solensia® for cats. However, livestock product sales declined by 7%, with cattle product sales particularly affected by a challenging comparison period from the prior year.

Internationally, Zoetis reported a revenue of $1.0 billion, reflecting a 3% increase on a reported basis and an 8% operational increase. Sales of companion animal products grew by 10% on a reported basis and 14% operationally, driven by products like Librela, Solensia, Apoquel, Cytopoint, and Simparica Trio. Conversely, livestock product sales saw a 4% decline on a reported basis but grew 2% operationally, with price increases contributing significantly to this growth.

Zoetis continues to invest in innovation and growth. The company received approval for several new products and expansions, including Valcor™ in Brazil, Protivity® in the U.K., and Bonqat® in the U.S. Additionally, Zoetis is expanding its key product franchises and has approved new claims for products like Synovex Choice® and Excenel® RTU EZ.

Zoetis also announced its acquisition of a manufacturing site in Melbourne, Australia, to support vaccine production for various animals, and the expansion of its distribution center in Lee's Summit, Missouri, to enhance product distribution capabilities in the U.S. Furthermore, Zoetis signed a deal to sell its medicated feed additive portfolio to focus on other livestock solutions.

The company has updated its full-year 2024 revenue guidance, forecasting revenue between $9.050 billion and $9.200 billion, with a diluted EPS of $5.34 to $5.44 on a reported basis, or $5.71 to $5.81 on an adjusted basis. The guidance reflects anticipated operational revenue growth of 8.5% to 10.5%, and operational growth in adjusted net income of 13% to 15%. This update accounts for foreign exchange rates and inflation-related price increases in certain markets.