Eli Lilly 2015 Annual Report Download - page 34

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F22
FINANCIAL REPORT
Management’s Discussion and Analysis of Results of
Operations and Financial Condition
RESULTS OF OPERATIONS
(Tables present dollars in millions, except per-share data)
Executive Overview
This section provides an overview of our financial results, recent product and late-stage pipeline
developments, and other matters affecting our company and the pharmaceutical industry. Earnings per share
(EPS) data is presented on a diluted basis.
Financial Results
The following table summarizes our key operating results:
Year Ended,
December 31,
Percent
Change from
2015 2014 2014
Revenue $19,958.7 $19,615.6 2 %
Gross margin 14,921.5 14,683.1 2 %
Gross margin as a percent of revenue 74.8% 74.9%
Operating expense (1) $11,329.4 $11,354.4 — %
Acquired in-process research and development 535.0 200.2 NM
Asset impairment, restructuring, and other special charges 367.7 468.7 (22)%
Net income 2,408.4 2,390.5 1 %
Earnings per share 2.26 2.23 1 %
(1) Operating expense consists of research and development and marketing, selling, and administrative expenses.
NM - not meaningful
Revenue and gross margin increased slightly in 2015. Operating expense in 2015 remained essentially flat as
a decrease in marketing, selling, and administrative expense was largely offset by increased research and
development expense. Net income and EPS increased slightly in 2015 as a higher gross margin, lower
income taxes, and decreased asset impairment, restructuring, and other special charges were largely offset
by increased acquired in-process research and development (IPR&D) charges and lower other income.
Management’s Discussion and Analysis of Results of Operations and Financial Condition