Elanco To Lay Off 20% Senior Management In Organizational Restructure

Elanco Animal Health Incorporated ELAN will consolidate commercial operations for Elanco International and Elanco Europe into one organization under Ramiro Cabral, EVP & President Elanco International.

• The restructuring includes eliminating approximately 380 positions, including about 20% of Elanco's senior management.
• Elanco believes the move will help offset previously disclosed higher cost pressures and maintain its current path to 60% adjusted gross margin by 2023 and 31% adjusted EBITDA margin by 2024. 
• Elanco expects to record a Q4 2021 pre-tax charge of $86 million - $94 million for severance costs.
• Reported Q4 net income is expected to reduce by $65 million - $71 million and EPS by approximately $0.13 to $0.15. 
• The compensation and benefits savings in 2022 are anticipated to be approximately $60 million, and once fully implemented, are expected to provide annual savings of roughly $70 million.
• There is no change to the 2021 full-year guidance for revenue of $4.73 billion - $4.77 billion, adjusted EBITDA of $1.03 billion - $1.07 billion, and adjusted EPS of $0.97 - $1.03.
• Price Action: ELAN shares are down 1.62% at $29.70 on the last check Tuesday.