Pfizer Reports Second-Quarter 2017 Results

Aug 1, 2017 - SELECTED TOTAL COMPANY REPORTED COSTS AND ..... In 2013, Pfizer and Lilly entered into a worldwide co-development and co-.
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PFIZER REPORTS SECOND-QUARTER 2017 RESULTS Second-Quarter 2017 Revenues of $12.9 Billion, Comparable Operationally with the Prior-Year Quarter; Unfavorably Impacted by $295 Million, or 2%, Due to the February 2017 Divestiture of Hospira Infusion Systems Second-Quarter 2017 Reported Diluted EPS(1) of $0.51, Adjusted Diluted EPS(2) of $0.67 Raised Midpoint of 2017 Adjusted Diluted EPS(2) Guidance Range by $0.02 to a Range of $2.54 to $2.60; Reaffirmed 2017 Revenue Guidance Range of $52.0 to $54.0 Billion

NEW YORK, NY, Tuesday, August 1, 2017 – Pfizer Inc. (NYSE: PFE) reported financial results for secondquarter 2017, increased the midpoint of its 2017 financial guidance range for Adjusted diluted EPS(2) and reaffirmed its 2017 financial guidance range for Revenues. Results for the second quarter and first six months of 2017 and 2016(3) are summarized below.

OVERALL RESULTS ($ in millions, except per share amounts)

Second-Quarter 2017 2016 $ 12,896 $ 13,147 3,073 2,047 0.51 0.33 4,063 3,929 0.67 0.64

Revenues Reported Net Income(1) Reported Diluted EPS(1) Adjusted Income(2) Adjusted Diluted EPS(2)

Change (2%) 50% 53% 3% 5%

2017 $ 25,675 6,194 1.02 8,255 1.36

Six Months 2016 $ 26,152 5,085 0.82 8,105 1.31

Change (2%) 22% 24% 2% 4%

REVENUES ($ in millions) 2017 Innovative Health Essential Health Total Company

$ 7,671 5,226 $ 12,896

Second-Quarter % Change 2016 Total Oper. $ 7,105 8% 9% 6,042 (14%) (12%) $ 13,147 (2%) —

Excluding HIS revenues from all periods: Total Company $ 12,896 $ 12,852 Essential Health 5,226 5,746

— (9%)

2% (7%)

-1-

Six Months 2017

2016

$ 15,086 10,590 $ 25,675

$ 14,139 12,013 $ 26,152

% Change Total Oper. 7% 8% (12%) (10%) (2%) (1%)

$ 25,578 10,493

$ 25,553 11,414

— (8%)

1% (6%)

Acquisitions and divestitures completed in 2016 and the first six months of 2017 impacted financial results in the periods presented.(4) Some amounts in this press release may not add due to rounding. All percentages have been calculated using unrounded amounts. References to operational variances pertain to period-over-period growth rates that exclude the impact of foreign exchange.(5) 2017 FINANCIAL GUIDANCE(6) The midpoint of the guidance range for Adjusted diluted EPS(2) was increased by $0.02 to an updated range of $2.54 to $2.60, reflecting a $300 million increase to the guidance for Adjusted Other (Income)/Deductions(2) due to lower-than-forecasted net interest expense as well as higher-than-forecasted royalty income from certain products and dividend income from ViiV Healthcare Ltd. (ViiV). Additionally, the updated financial guidance absorbs $75 million of Adjusted research and development expenses(2) that were recorded in second-quarter 2017 resulting from our May 2017 agreement with Sangamo Therapeutics, Inc. (Sangamo) to develop and commercialize gene therapy programs for Hemophilia A. Pfizer’s updated 2017 financial guidance is presented below: Revenues Adjusted Cost of Sales(2) as a Percentage of Revenues Adjusted SI&A Expenses(2) Adjusted R&D Expenses(2)

$52.0 to $54.0 billion 20.0% to 21.0% $13.7 to $14.7 billion $7.5 to $8.0 billion Approximately $200 million of income (previously approximately $100 million of deductions) Approximately 23.0% $2.54 to $2.60 (previously $2.50 to $2.60)

Adjusted Other (Income)/Deductions(2) Effective Tax Rate on Adjusted Income(2) Adjusted Diluted EPS(2)

CAPITAL ALLOCATION During the first six months of 2017, Pfizer returned $8.9 billion directly to shareholders, through a combination of: –

$3.9 billion of dividend payments, composed of $0.32 per share of common stock in each of the first and second quarters of 2017; and



a $5.0 billion accelerated share repurchase agreement executed i