In a release dated February 13th, Zoetis (ZTS) reported on results for the fourth quarter and FY 2023 ending December 31st. For FY 23023 revenue was in line with estimates but the Company was below consensus on EPS. Zoetis reported net income of $525 million on revenue of $2,213 million. These values are compared with Q4 of FY 2022 with net earnings of $461 million on sales of $2,040 million. Diluted EPS increased from $0.99 in Q4 of FY 2022 to $1.14 for the most recently completed quarter.
For Q4 2023 gross margin was 67.1 percent (68.0 percent Q4 2022); operating margin attained 24.3 percent (22.5 percent)
For FY 2023 the Company reported net income of $2,344 million on revenue of $8,544 million. These values are compared with FY 2022 with net earnings of $2,114 million on sales of $8,080 million. Diluted EPS increased from $4.09 in FY 2022 to $5.07 for FY 2023.
In reviewing product segments, Q4 2023 total revenue from companion animal products amounted to $1,448 million (65.4 per cent of Company sales) compared to revenue from livestock products amounting to $745 million (33.7 percent). The remainder was derived from other products and services.
Domestic U.S. sales of livestock products at $270 represented 22.2 percent of livestock revenue of $1,211 million, up 4.2 percent from Q4 2022. International sales of livestock products represented 48.3 percent of non-U.S. Company revenue of $982 up 5.3 percent from Q4 2022. Poultry products at $127 million represented 17.0 percent of livestock sales of $745, an increase of 10.4 percent from Q4 2022 and comprising 5.7 percent of total sales.
In commenting on Q2 results, Kristin Peck, CEO stated, " Zoetis delivered another strong performance in 2023 thanks to our diverse portfolio across markets and species and our dedicated colleagues,” She added “We grew revenue 7 percent operationally, driven by our innovative companion animal franchises across pain, dermatology and parasiticides. We also grew our adjusted net income 7 percent operationally, while continuing to support investments in R&D, supply chain, and commercial excellence capabilities that will drive our next phase of growth.”
Ms. Peck concluded “We are well-positioned for growth in our other key franchises, including dermatology, parasiticides and diagnostics, and will continue to invest in solutions that will shape and expand the future of animal health. We are committed to continuing our track record of innovation and growing faster than the market, even during times of global uncertainty, and are guiding to full-year operational growth of 7 to 9 percent in revenue in 2024,”
Zoetis posted guidance for fiscal 2024 including revenue ranging from $9,075 to $9,225 million, net income from $2,468 to $2,513 million and diluted EPS ranging from $5.34 to $5.44.
The Company posted total assets of $14,286 million on December 31st 2023 of which $4,097 million represented goodwill and intangibles against long-term debt of $6,989 million. Market capitalization was $86,260 million on February 16th. Zoetis has traded over the past 52-weeks in a range of $151.03 to $190.33 with a 50-day moving average of $192.60. The Company achieved a trailing twelve-month operating margin of 32.1 percent and a profit margin of 27.4 percent. The return on assets attained 13.2 percent and 49.8 percent on equity.