Amgen Inc (NASDAQ:AMGN) Q4 2014 Earnings Conference Call - Final Transcript

Jan 27, 2015 • 05:00 pm ET


Amgen Inc (NASDAQ:AMGN) Q4 2014 Earnings Conference Call - Final Transcript


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My name is Marvin, and I will be your conference facilitator today for Amgen's Fourth Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. There will be a question-and-answer session at the conclusion of the last speakers' prepared remarks. In order to ensure that everyone has a chance to participate, we would like to request that you limit yourself to asking one question during the Q&A session.

(Operator Instructions) I would now like to introduce Arvind Sood, VP of IR. Mr. Sood, you may now begin.

Arvind Sood

Okay. Thank you, Marvin and good afternoon everybody. I hope that listeners for those of you in the Northeast wasn't too disruptive. I would like to welcome you to our conference call to review our operating performance for the fourth quarter and full year 2014. We accomplished a lot during 2014 on many fronts.

And we look forward to delivering once again for our shareholders in 2015. While 2014 was characterized by significant clinical data flow, 2015 will be characterized by regulatory submissions and new product launches. So leading the call today will be our Chairman and CEO, Bob Bradway who will provide a strategic report on our performance in 2014 and outlook for 2015. Following Bob our CFO, David Meline will then review our Q4 and full year results and address financial guidance for 2015. Tony Hooper our Head of Global Commercial Operations will discuss our product performance during the quarter and trends that we see going forward. And finally, Sean Harper, our head of R&D will provide a pipeline update. After Sean's comments we should have ample time for Q&A. We will use slides for presentation today. These slides have been posted on our website and a link was sent to you separately by email.

(Forward-Looking Cautionary Statements)

So with that I would like to turn the call over to Bob.

Bob Bradway

Okay, thank you Arvind. I thank all of you for joining our call this afternoon. 2014 was really an outstanding year for us and let me start with the financial highlights, which include revenue growth of 7%, enabling us to eclipse $20 billion for the first time. Consistent with our international expansion objectives sales outside of the US grew by double-digit rates in 2014.

Our adjusted operating income growth of 22% reflects our commitment to generating operating leverage from our business. As you know one of our objectives for 2014 was to deliver to shareholders $800 million of improved profitability from Enbrel. We exceeded that objective in 2014. In addition, our free cash flow grew by 40% to $7.8 billion. This strong financial performance and our confidence in the longer-term outlook enabled us to increase our dividend by 30% in 2014 and by 30% again for 2015 while increasing our stock buyback plans as well.

Turning now to our progress with innovation. We had an extraordinary flow of data from our pipeline in 2014. We generated positive pivotal data for six innovative programs and submitted