Established Brands Hit Organon's Q4 Sales, Expects FY22 Sales Of Upto $6.4B

Organon & Co's OGN Q4 FY21 sales decreased 1% to $1.6 billion, beating the consensus of $1.57 billion.

• Women's Health increased 6%, driven primarily by Nexplanon, which increased 37% ex-FX. Nexplanon's growth was due to increased demand in the U.S., and tenders won. 
• The increase in Women's Health was partially offset by a decline in sales of Nuvaring vaginal ring, which continues to be impacted by generic competition.
• Biosimilars revenue grew 15%, driven by continued growth in the U.S. for Renflexis and growth in Canada.
• The decline in Established Brands was primarily due to a terminated agreement in Korea for Rosuzet, loss of exclusivity for Zetia (ezetimibe) in Japan in June 2020.
• The adjusted gross margin improved marginally to 66% from 65.2%. The Company reported adjusted EBITDA of $549 million, down 19%.
• The adjusted EPS declined 30% to $1.37, beating the consensus of $1.24.
• Dividend: Organon announced a quarterly dividend of $0.28/share payable on March 17, with a record date of February 28.
• Guidance: Organon forecasts FY22 revenue of $6.1 billion - $6.4 billion vs. consensus of $6.33 billion, with an adjusted EBITDA margin of 34%-36%.
• Price Action: OGN shares closed at $36.34 on Wednesday.