Category: 3. Business

• In the real-world, Pluvicto™ showed 13.5 months median PFS in chemo-naïve patients with PSMA-positive mCRPC
  
• Real‑world evidence showed Pluvicto achieved longer PFS when initiated after one ARPI instead of multiple ARPIs
  
• A separate analysis of treatment patterns in metastatic hormone-sensitive prostate cancer suggest significant opportunity for increased guideline adherence

Basel, February 24, 2026 – Novartis today announced multiple US real-world studies delivering new insights across metastatic prostate cancer care. The analyses utilize data from Novartis’ PRECISION platform to evaluate Pluvicto™ (lutetium (¹⁷⁷Lu) vipivotide tetraxetan) effectiveness and sequencing as well as real‑world treatment patterns in earlier metastatic disease. These studies will be presented at the ASCO Genitourinary Cancers Symposium on February 26, 2026.

Pluvicto shows real-world effectiveness in taxane-naïve mCRPC patients
Real-world use of Pluvicto resulted in a median progression-free survival (PFS) of 13.5 months (95% CI: 11.7 – 14.7 months) in men with metastatic castration-resistant prostate cancer (mCRPC) who had been treated with ≥1 androgen receptor pathway inhibitor (ARPI) and were taxane-naïve. Results showed chemo-naïve patients treated with Pluvicto after only 1 ARPI had longer median PFS (15.8 months; 95% CI: 11.7 – 18.6 months) than those who received Pluvicto after multiple ARPIs (12.7 months; 95% CI: 10.7 – 14.0 months⁾¹.

“This analysis validates what many of us have seen in the clinic – that lutetium Lu 177 vipivotide tetraxetan can achieve clinically relevant responses across a diverse set of patients and in various practice settings,” said Daniel George, Professor of Medicine and Surgery at Duke University School of Medicine. “These results show reassuring consistency with the PSMAfore pivotal trial and should strengthen clinicians’ confidence in using radioligand therapy for patients after one ARPI.”

PSA50 indicates ≥50% decline in prostate-specific antigen levels from baseline

The real-world findings are consistent with PSMAfore, which supported the approval of Pluvicto for patients with PSMA-positive mCRPC who have been treated with an ARPI and are considered appropriate to delay taxane-based chemotherapy. In PSMAfore, Pluvicto more than doubled median rPFS compared to a change in ARPI (11.6 months vs. 5.6 months) at an updated exploratory analysis². These findings should be considered within the context of varying study designs, patient populations, and endpoints across the analyzed cohorts*.

“Pluvicto is redefining the standard of care for metastatic prostate cancer. Novartis is committed to advancing the science of radioligand therapy through ongoing rigorous clinical development and real-world evidence generation,” said Liviu Niculescu, Chief Medical Officer, US at Novartis. “These real-world findings build on the evidence from our robust clinical trial program and contribute to a broader understanding of treatment outcomes observed in routine practice.”

Study assesses response with systemic therapies when used after Pluvicto
A second study showed that patients with mCRPC achieved meaningful clinical responses with systemic therapies after discontinuing Pluvicto (including taxane, ARPI, PARP inhibitor or other), most of whom had prior exposure to ARPI and chemotherapy².

“With the emergence of new advanced therapies for metastatic prostate cancer, including radioligand therapies, optimizing the sequencing of systemic therapies has become increasingly important for clinicians,” said Dr. Xiao Wei at the Dana-Farber Cancer Institute. “These findings are reassuring, as they suggest that treatment with lutetium Lu 177 vipivotide tetraxetan does not preclude the effectiveness of subsequent therapies for appropriate patients.”

Analysis shows gaps in guideline-adherent care for mHSPC
Despite clear clinical guidelines recommending treatment intensification with androgen deprivation therapy (ADT) and ARPI for metastatic hormone-sensitive prostate cancer (mHSPC), a substantial proportion of men continue to receive ADT alone. In a large US real-world study, nearly four in ten (39.2%) men received ADT monotherapy while just over half (55.5%) received combination ADT+ARPI (n=43,415 patients treated between 2020 and 2025)⁵. While adoption of guideline‑recommended therapy is improving, these data underscore a significant remaining opportunity for patients to receive optimal care.

About the PRECISION data platform
PRECISION – the PRostatE Cancer dISease observatION platform – is a US real-world evidence platform developed by Novartis and urology and oncology experts. The platform harmonizes data from more than 56,500 patients with metastatic prostate cancer to generate RWE studies that inform clinical decisions and everyday care.

*Analysis of PFS in the PRECISION data platform included biochemical, radiographic and clinical assessments. In PSMAfore, the primary endpoint was rPFS defined as the time from randomization to radiographic disease progression (assessed by blinded independent central review) or death.

Disclaimer
This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements can generally be identified by words such as “potential,” “can,” “will,” “plan,” “may,” “could,” “would,” “expect,” “anticipate,” “look forward,” “believe,” “committed,” “investigational,” “pipeline,” “launch,” or similar terms, or by express or implied discussions regarding potential marketing approvals, new indications or labeling for the investigational or approved products described in this press release, or regarding potential future revenues from such products. You should not place undue reliance on these statements. Such forward-looking statements are based on our current beliefs and expectations regarding future events, and are subject to significant known and unknown risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. There can be no guarantee that the investigational or approved products described in this press release will be submitted or approved for sale or for any additional indications or labeling in any market, or at any particular time. Nor can there be any guarantee that such products will be commercially successful in the future. In particular, our expectations regarding such products could be affected by, among other things, the uncertainties inherent in research and development, including clinical trial results and additional analysis of existing clinical data; regulatory actions or delays or government regulation generally; global trends toward health care cost containment, including government, payor and general public pricing and reimbursement pressures and requirements for increased pricing transparency; our ability to obtain or maintain proprietary intellectual property protection; the particular prescribing preferences of physicians and patients; general political, economic and business conditions, including the effects of and efforts to mitigate pandemic diseases; safety, quality, data integrity or manufacturing issues; potential or actual data security and data privacy breaches, or disruptions of our information technology systems, and other risks and factors referred to in Novartis AG’s current Form 20-F on file with the US Securities and Exchange Commission. Novartis is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise.

About Novartis
Novartis is an innovative medicines company. Every day, we work to reimagine medicine to improve and extend people’s lives so that patients, healthcare professionals and societies are empowered in the face of serious disease. Our medicines reach more than 300 million people worldwide.

Reimagine medicine with us: Visit us at https://www.novartis.com and connect with us on LinkedIn, Facebook, X/Twitter and Instagram.

References

1. George DJ, et al. Real‑world outcomes of [177Lu]Lu‑PSMA‑617 in taxane‑naïve patients with metastatic castration‑resistant prostate cancer (mCRPC): a PRECISION data platform analysis. Presented at ASCO Genitourinary Cancers Symposium, February 26, 2026.
2. Wei XX, et al. Real‑world effectiveness of systemic therapies after [177Lu]Lu‑PSMA‑617 treatment in patients with metastatic castration‑resistant prostate cancer (mCRPC): a PRostatE Cancer dISease observatION (PRECISION) data platform analysis. Presented at ASCO Genitourinary Cancers Symposium, February 26–28, 2026.
3. National Comprehensive Cancer Network^® (NCCN^®) Guidelines. NCCN Clinical Practice Guidelines in Oncology (NCCN Guidelines^®) – Prostate Cancer. https://www.nccn.org/professionals/physician_gls/pdf/prostate.pdf
4. George DJ, et al. Treatment utilization among patients with metastatic hormone‑sensitive prostate cancer (mHSPC) in real‑world US settings: a PRostatE Cancer dISease observatION (PRECISION) data platform analysis. Presented at ASCO Genitourinary Cancers Symposium, February 26–28, 2026.
5. Sartor O, et al. Clinical outcomes among patients with metastatic hormone‑sensitive prostate cancer (mHSPC) in contemporary real‑world US clinical practice: a PRostatE Cancer dISease observatION (PRECISION) data platform analysis. Presented at ASCO Genitourinary Cancers Symposium, February 26–28, 2026. 

Raising 2026 Innovation Target; Full Year 2026 Guidance of 4%-6% Organic Constant Currency Revenue Growth, 6%-9% Adjusted EBITDA Growth In Line with Investor Day Outlook

• Fourth Quarter 2025 Financial Results:
  • Revenue of $1,144 million, increased 12% on a reported basis; 9% in organic constant currency
  • Reported Net Loss of $276 million, Adjusted Net Income of $64 million
  • Adjusted EBITDA of $189 million; Adjusted EBITDA Margin of 16.7%
  • Reported EPS of $(0.56), Adjusted EPS of $0.13
• Full Year 2025 Financial Results:
  • Exceeded innovation revenue target at $892 million; delivered all ‘Big 6’ blockbuster potential products by the end of 2025 with Befrena approval in Q4 2025
  • Revenue of $4,715 million, increased 6% on a reported basis and 7% in organic constant currency
  • Reported Net Loss of $232 million, Adjusted Net Income of $473 million
  • Adjusted EBITDA of $901 million; Adjusted EBITDA Margin of 19.2%
  • Reported EPS of $(0.47), Adjusted EPS of $0.94 
  • Net leverage ratio of 3.6x Adjusted EBITDA
• Full Year 2026 Guidance:
  • Raising innovation revenue target to $1.15 billion
  • Revenue of $4,950 million to $5,020 million, or 4% to 6% organic constant currency growth
  • Adjusted EBITDA of $955 million to $985 million, an increase of 8% at midpoint
  • Adjusted EPS of $1.00 to $1.06, an increase of 10% at midpoint
  • Year-end net leverage ratio target of 3.1x to 3.3x
  • In line with three-year outlook introduced at December Investor Day, outlining mid-single digit top-line organic constant currency growth, high-single digit Adjusted EBITDA growth, and low double-digit Adjusted EPS growth

INDIANAPOLIS, Feb. 24, 2026 /PRNewswire/ — Elanco Animal Health Incorporated (NYSE: ELAN) today reported its financial results for the fourth quarter and full year 2025 and provided initial guidance for both the first quarter and full year 2026.

“Elanco delivered significant progress across our strategic priorities of growth, innovation, and cash in 2025,” said Jeff Simmons, President and CEO of Elanco. “We achieved a strong fourth quarter with 9% organic constant currency revenue growth, marking our 10th consecutive quarter of underlying growth. Importantly, 2025 growth was high quality, spanning all four business quadrants, with contributions from price and volume, and with nine of our top 10 largest countries growing. Our innovation continues to exceed expectations, and we’re raising our outlook for this basket to $1.15 billion in 2026 given the strong momentum, market share gains, and positive customer response. Our relentless focus on cash generation has allowed us to improve our net leverage ratio faster than planned, ending the year at 3.6x, well on our way to under 3x in 2027. Elanco is excited about our new era of growth built on a proven track record of consistent execution, with a robust pipeline and a highly engaged team to continue transforming animal care and delivering long-term value for our shareholders.”

Select Business Highlights Since the Last Earnings Call

• Received USDA approval for Befrena™, a new anti-IL31 monoclonal antibody (mAb) injection targeting canine allergic and atopic dermatitis; recommended at a dosing interval of 6 to 8 weeks post-treatment vs. 4 to 8 weeks for the current market competitor
• Credelio Quattro™ achieved continued dollar share gains of broad-spectrum sales out of U.S. vet clinics in Q4, at the same pace as in Q3**; Australian approval received in February as Advocate™ Ultra Chew
• Achieved Zenrelia™ use in approximately 50% of U.S. clinics and double-digit share of the U.S. JAK market exiting December**; efficacy driving global momentum and share gains, with approximately 40% share of JAK market in Brazil, over 30% share in Japan, over 10% share in the U.K., and double-digit share in France, Italy, and Spain, outperforming the competitive entrant***
• Experior® 2025 sales over $200 million, up nearly 80% year over year; AdTab™ continued robust growth trajectory with Q4 sales up over 50% year over year

**Per Kynetec Q3 and Q4 data
***Internal estimates based on multiple data sources

Select Investor Day Highlights (December 2025)

• Detailed three-year outlook with annual mid-single digit top-line organic constant currency growth driven by a consistent flow of high-impact innovation, high-single digit Adjusted EBITDA growth and low double-digit Adjusted EPS growth, all starting in 2026
• Expecting free cash flow of at least $1 billion over the period from 2026 through 2028, and further net leverage ratio improvement to <3x in 2027, with a long-term target of 2.0x to 2.5x
• Expected innovation revenue contribution of approximately $1.1 billion in 2026 — now raised to $1.15 billion — with aims to double revenue from ‘Big 6’ blockbuster potential products by 2028
• Expecting five to six blockbuster-potential approvals over the next six years. Two in-house technology development platforms contributing to next wave innovation pipeline: monoclonal antibody discovery and immuno-therapeutics
• Announced intended closure of German animal R&D facility and targeted reduction to manufacturing workforce along with increased investment in Elanco Innovation Laboratories at Indiana headquarters and continued investments in U.S. manufacturing with greater clarity on U.S. tariffs and accelerated USDA regulatory timelines. This includes an accelerated conditional approval pathway for a potential first-in-class immuno-therapeutic major pet blockbuster, expected in the next two to three years
• Outlined Elanco Ascend productivity initiative expected to deliver $200 million to $250 million in Adjusted EBITDA savings by 2030, with approximately 30% achieved in 2026
• Announced restructuring as part of Elanco Ascend to support margin expansion, optimize footprint and further increase innovation capacity. Approximately $155 million recorded as restructuring costs in the fourth quarter, of which $116 million is related to expected cash-based costs. An additional $25 million to $30 million of costs are anticipated in 2026, a majority of which are expected to be non-cash costs. Expecting savings of approximately $25 million in 2026 and approximately $60 million in 2027

Financial Highlights

Fourth Quarter Results

In the fourth quarter of 2025, revenue was $1,144 million, an increase of 12% on a reported basis and a 9% increase on an organic constant currency basis, compared with the fourth quarter of 2024.

Pet Health revenue was $489 million, an increase of 11% on a reported basis and a 9% increase on an organic constant currency basis, with a 1% increase from price in the quarter. The year over year increase in the fourth quarter was primarily driven by new products, including Credelio Quattro and Zenrelia. The Advantage® Family of products and Seresto contributed revenue of $84 million and $52 million, respectively.

Farm Animal revenue was $640 million, a 12% increase on a reported basis and a 10% increase on an organic constant currency basis. In addition to a 2% contribution from price in the fourth quarter of 2025, growth was also driven by increased volumes across cattle and poultry, led by Experior in U.S. cattle and strength in U.S. and European poultry sales.

Gross profit was $589 million, or 51.5% of revenue in the fourth quarter of 2025. Gross profit as a percent of revenue increased 60 basis points, primarily driven by price, increased sales volumes, and mix benefits, which were partially offset by higher manufacturing costs. On an adjusted basis, gross profit was $581 million and gross margin percentage was 51.2% in the fourth quarter of 2025, a 30 basis point increase compared to the fourth quarter of 2024.

Total operating expenses were $431 million for the fourth quarter of 2025, a 13% increase compared to the fourth quarter of 2024. Marketing, selling and administrative expenses increased 13% to $338 million, driven by investments to support the company’s expanding pet health business and people related expenses. Research and development expenses increased 15% to $93 million driven by pipeline investments.

Asset impairment, restructuring, and other special charges were $202 million in the fourth quarter of 2025, compared to $7 million in the fourth quarter of 2024. The company recorded $155 million of charges in the fourth quarter of 2025 associated with our recently announced restructuring plan, of which $116 million related to expected cash-based severance costs and $39 million related primarily to non-cash impairment charges associated with facilities the company plans to exit in Monheim, Germany, and Kansas City, Kansas. The company also recorded a $47 million impairment of a marketed product intangible asset during the fourth quarter of 2025 due to a decline in projected sales of a product group acquired in a past acquisition.

Net interest expense was $80 million in the fourth quarter of 2025, an increase of 74% as compared to the fourth quarter of 2024. This increase was primarily driven by $20 million related to refinancing costs and the write-off of previously deferred debt issuance costs and $13 million of imputed interest on the company’s liability related to the lotilaner U.S. royalty monetization. Adjusted net interest expense, which excludes these two items, was $47 million in the fourth quarter of 2025, an increase of $1 million compared to the fourth quarter of 2024. As of September 30, 2025, the interest benefits being amortized from past interest rate swap settlements were fully realized, resulting in increased interest expense that was mostly offset by the impact of lower outstanding debt balances.

Other income was $4 million in the fourth quarter of 2025 on a reported basis, driven by foreign currency gains, compared to other expense of $6 million in the fourth quarter of 2024, which was driven by foreign currency losses and the impairment of a previously divested R&D platform.

The reported effective tax rate was (6.5)% in the fourth quarter of 2025 compared to 84.5% in the fourth quarter of 2024. The adjusted effective tax rate was 39.9% in the fourth quarter of 2025 as compared to 26.2% in the fourth quarter of 2024.

Net loss for the fourth quarter of 2025 was $276 million, or $0.56 per diluted share on a reported basis, compared with a net loss of $8 million and $0.02 per diluted share for the same period in 2024. On an adjusted basis, net income for the fourth quarter of 2025 was $64 million, or $0.13 per diluted share, as compared to $72 million, or $0.14 per diluted share, for the fourth quarter of 2024.

Adjusted EBITDA was $189 million in the fourth quarter of 2025, an increase of 7% compared to the fourth quarter of 2024. Adjusted EBITDA margin was 16.7%, compared with 17.4% for the fourth quarter of 2024.

Working Capital and Balance Sheet

Cash provided by operations was $108 million in the fourth quarter of 2025 compared to $177 million in the fourth quarter of 2024. The decrease in cash from operations in the fourth quarter of 2025 reflects expected cash tax payments primarily related to the 2024 divestiture of the Aqua business partially offset by improvements in net working capital.

As of December 31, 2025, Elanco’s net leverage ratio was 3.6x adjusted EBITDA, a reduction of 0.1x to September 30, 2025.

Financial Guidance

Elanco is providing financial guidance for the full year 2026, summarized in the following table, subject to the assumptions described below:

For the full year, the company expects a $55 million tailwind from foreign exchange rates compared to prior year. Excluding the impacts of foreign exchange rates and royalty revenue sold to a third party, the company expects revenue growth of 4% to 6%. Guidance includes an accelerating contribution from price compared to the prior year. Adjusted EBITDA guidance reflects savings from the Elanco Ascend initiative as well as incremental strategic investment in the global launches of the company’s innovation portfolio and advancement of the R&D pipeline.

“We are entering 2026 with positive momentum, and strong confidence in our IPP strategy to drive continued execution and value creation,” said Bob VanHimbergen, Executive Vice President and CFO of Elanco. “Our full-year outlook is balanced and consistent with the framework provided at our December Investor Day. We anticipate sustainable, competitive revenue growth as our innovation portfolio scales globally, on top of a stabilizing base. This innovation, combined with strategic pricing, helps to insulate us from broader macro pressures. Elanco Ascend, our productivity initiative, is on track to enable adjusted EBITDA margin expansion starting this year. We expect accelerating free cash flow over the next three years to further strengthen our balance sheet and improve our net leverage ratio.”

In the first quarter, the company expects a $40 million tailwind from foreign exchange rates compared to prior year. Excluding the impacts of foreign exchange rates and royalty revenue sold to a third party, the company expects 4% to 6% revenue growth. The company expects operating expenses up 7% year over year (4% in constant currency) including strategic investment in the global launches of the innovation portfolio.

The 2026 full year and first quarter financial guidance reflects foreign exchange rates as of earlier this month. Further details on guidance, including GAAP reported to non-GAAP adjusted reconciliations, are included in the financial tables of this press release and will be discussed on the company’s conference call this morning.

A reconciliation of forward-looking non-GAAP measures, including adjusted EPS, adjusted EBITDA and adjusted EBITDA margin guidance, to the most directly comparable GAAP measures is not provided because comparable GAAP measures for such measures are not reasonably accessible or reliable due to the inherent difficulty in forecasting and quantifying measures that would be necessary for such reconciliation. Namely, Elanco is not, without unreasonable effort, able to reliably predict the impact of net interest expense; income tax expense/benefit; depreciation and amortization charges; asset impairment, restructure and other special charges; sold royalty revenue; and other adjustments. In addition, Elanco believes such a reconciliation would imply a degree of precision and certainty that could be confusing to investors. These items are uncertain, depend on various factors and may have a material impact on future GAAP results. See “Cautionary Statement Regarding Forward-Looking Statements” and “Use of Non-GAAP Financial Measures.”

WEBCAST & CONFERENCE CALL DETAILS

Elanco will host a webcast and conference call at 8:00 a.m. Eastern Time today, during which company executives will review fourth quarter and full year 2025 financial and operational results, provide financial guidance for the full year and first quarter of 2026, and respond to questions from analysts. Investors, analysts, members of the media and the public may access the live webcast and accompanying slides by visiting the Elanco website at https://investor.elanco.com and selecting Events and Presentations. A replay of the webcast will be archived and made available a few hours after the event on the company’s website, at https://investor.elanco.com/events-and-presentations/default.aspx#module-event-upcoming.

ABOUT ELANCO

Elanco Animal Health Incorporated (NYSE: ELAN) is a global leader in animal health dedicated to innovating and delivering products and services to prevent and treat disease in farm animals and pets, creating value for farmers, pet owners, veterinarians, stakeholders and society as a whole. With more than 70 years of animal health heritage, we are committed to breaking boundaries and going beyond to help our customers improve the health of animals in their care, while also making a meaningful impact on our local and global communities. At Elanco, we are driven by our vision of Food and Companionship Enriching Life and our purpose – to Go Beyond for Animals, Customers, Society and Our People. Learn more at www.elanco.com.

Cautionary Statement Regarding Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements concerning product launches and revenue from such products, our 2026 full year and first quarter guidance and long-term expectations, our expectations regarding debt levels, and expectations regarding our industry and our operations, performance and financial condition, and including, in particular, statements relating to our business, growth strategies, distribution strategies, product development efforts and future expenses.

Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important risk factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions, including but not limited to the following:

• operating in a highly competitive industry;
• the success of our research and development (R&D), regulatory approval and licensing efforts;
• the impact of disruptive innovations and advances in veterinary medical practices, animal health technologies and alternatives to animal-derived protein;
• competition from generic products that may be viewed as more cost-effective;
• changes in regulatory restrictions on the use of antibiotics in farm animals;
• an outbreak of infectious disease carried by farm animals;
• risks related to the evaluation of animals;
• consolidation of our customers and distributors;
• an increased use of alternative distribution channels or changes within existing distribution channels;
• our dependence on the success of our top products;
• our ability to complete acquisitions and divestitures and to successfully integrate the businesses we acquire;
• our ability to implement our business strategies or achieve targeted cost efficiencies and gross margin improvements;
• manufacturing problems and capacity imbalances, including at our contract manufacturers;
• fluctuations in inventory levels in our distribution channels;
• risks related to the use of artificial intelligence in our business;
• our dependence on sophisticated information technology systems and infrastructure, including the use of third-party, cloud-based technologies, and the impact of outages or breaches of the information technology systems and infrastructure we rely on;
• the impact of weather conditions, including those related to climate change, and the availability of natural resources;
• demand, supply and operational challenges associated with the effects of a human disease outbreak, epidemic, pandemic or other widespread public health concern;
• the loss of key personnel or highly skilled employees;
• adverse effects of labor disputes, strikes and/or work stoppages;
• the effect of our substantial indebtedness on our business, including restrictions in our debt agreements that limit our operating flexibility and changes in our credit ratings that lead to higher borrowing expenses and restrict access to credit;
• changes in interest rates that adversely affect our earnings and cash flows;
• risks related to the write-down of goodwill or identifiable intangible assets;
• the lack of availability or significant increases in the cost of raw materials;
• risks related to foreign and domestic economic, political, legal and business environments;
• risks related to foreign currency exchange rate fluctuations;
• risks related to underfunded pension plan liabilities;
• our current plan not to pay dividends and restrictions on our ability to pay dividends;
• the potential impact that actions by activist shareholders could have on the pursuit of our business strategies;
• risks related to tax expense or exposures;
• actions by regulatory bodies, including as a result of their interpretation of studies on product safety;
• the possible slowing or cessation of acceptance and/or adoption of our farm animal sustainability initiatives;
• the impact of increased regulation or decreased governmental financial support related to the raising, processing or consumption of farm animals;
• risks related to tariffs, trade protection measures or other modifications of foreign trade policy;
• the impact of litigation, regulatory investigations and other legal matters, including the risk to our reputation and the risk that our insurance policies may be insufficient to protect us from the impact of such matters;
• challenges to our intellectual property rights or our alleged violation of rights of others;
• misuse, off-label or counterfeiting use of our products;
• unanticipated safety, quality or efficacy concerns and the impact of identified concerns associated with our products;
• insufficient insurance coverage against hazards and claims;
• compliance with privacy laws and security of information;
• risks related to environmental, health and safety laws and regulations; and
• inability to achieve our aspirations or meet the expectations of stakeholders with respect to environmental, social and governance matters.

For additional information about the factors that could cause actual results to differ materially from forward-looking statements, please see the company’s latest Form 10-K and Form 10-Qs filed with the Securities and Exchange Commission. Although we have attempted to identify important risk factors, there may be other risk factors not presently known to us or that we presently believe are not material that could cause actual results and developments to differ materially from those made in or suggested by the forward-looking statements contained in this press release. If any of these risks materialize, or if any of the above assumptions underlying forward-looking statements prove incorrect, actual results and developments may differ materially from those made in or suggested by the forward-looking statements contained in this press release. We caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this press release. Any forward-looking statement made by us in this press release speaks only as of the date thereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or to revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should be viewed as historical data.

Use of Non-GAAP Financial Measures:

We use non-GAAP financial measures, such as revenue growth excluding the impact of divestitures, foreign exchange rate effects and royalty revenue sold to a third party; EBITDA; adjusted EBITDA; adjusted EBITDA margin; adjusted net income; adjusted EPS; adjusted gross profit; adjusted gross margin; net debt and net debt leverage to assess and analyze our operational results and trends as explained in more detail in the reconciliation tables later in this release.

We believe these non-GAAP financial measures are useful to investors because they provide greater transparency regarding our operating performance. Reconciliation of non-GAAP financial measures and reported U.S. generally accepted accounting principles (GAAP) financial measures are included in the tables accompanying this press release and are posted on our website at www.elanco.com. The primary material limitations associated with the use of such non-GAAP measures as compared to GAAP results include the following: (i) they may not be comparable to similarly titled measures used by other companies, including those in our industry, (ii) they exclude financial information and events, such as the effects of an acquisition or divestiture or amortization of intangible assets, that some may consider important in evaluating our performance, value or prospects for the future, (iii) they exclude items or types of items that may continue to occur from period to period in the future and (iv) they may not exclude all unusual or non-recurring items, which could increase or decrease these measures, which investors may consider to be unrelated to our long-term operations. These non-GAAP measures are not, and should not, be viewed as substitutes for GAAP reported measures. We encourage investors to review our unaudited consolidated financial statements in their entirety and caution investors to use GAAP measures as the primary means of evaluating our performance, value and prospects for the future, and non-GAAP measures as supplemental measures.

Availability of Certain Information

We use our website to disclose important company information to investors, customers, employees and others interested in Elanco. We encourage investors to consult our website regularly for important information about Elanco, including an Investor Overview presentation containing a general overview of the business, which can be found in the Events and Presentations page of our website.

Additional Information

We define innovation revenue as revenue from new products, lifecycle management and certain geographic expansions and business development transactions that is incremental in reference to product revenue in 2020 and does not include the expected impact of cannibalization on the base portfolio.

We define organic constant currency revenue growth as revenue growth excluding the impacts from our prior year divestiture of the aqua business, which was divested on July 9, 2024, royalty revenue that was sold to a third party and the impact of foreign exchange rates.

Elanco Animal Health Incorporated
Reconciliation of GAAP Reported to Selected Non-GAAP Adjusted Information
(Unaudited)
(Dollars and shares in millions, except per share data)

We use non-GAAP financial measures, such as organic constant currency revenue growth, adjusted gross profit, adjusted gross margin percentage, adjusted net income, adjusted EPS, EBITDA, adjusted EBITDA and adjusted EBITDA margin and net debt and net debt leverage, that differ from financial measures reported in conformity with GAAP. The company believes these non-GAAP measures provide useful information to investors. Among other things, they may help investors assess and analyze our operational results and trends of our ongoing operations. Management also uses these non-GAAP measures internally to evaluate the performance of the business and in making resource allocation decisions. Investors should consider these non-GAAP measures in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. Reconciliation of non-GAAP financial measures and reported GAAP financial measures are included in the tables below.

Adjusted Gross Profit and Gross Margin Percentage

We define gross profit as total revenue less cost of sales. We define adjusted gross profit as gross profit less royalty revenue sold to a third party, less cost of sales adjustments. We define adjusted gross margin percentage as adjusted gross profit divided by total revenue, less royalty revenue sold to a third party. The following is a reconciliation of GAAP reported gross profit for the three months and years ended December 31, 2025 and 2024, to adjusted gross profit and adjusted gross margin percentage:

Adjusted Net Income and Earnings Per Share

We define adjusted net income as net income (loss) excluding amortization of intangible assets, purchase accounting adjustments to inventory, acquisition and divestiture-related charges, including integration and separation costs, severance, goodwill and other asset impairments, gains on sales of assets and related costs, facility exit costs, the impacts from sales of future revenues, gains and losses on mark-to-market adjustments on equity securities, tax valuation allowances and other specified significant items, such as unusual or non-recurring items that are unrelated to our long-term operations adjusted for income tax expense associated with the excluded financial items. We define adjusted earnings per share as adjusted net income divided by the number of weighted-average diluted shares outstanding for the applicable period. The following is a reconciliation of GAAP reported loss and EPS for three months ended December 31, 2025 and 2024, to adjusted net income and EPS:

The following is a reconciliation of GAAP reported net (loss) income and EPS for the years ended December 31, 2025 and 2024, to adjusted net income and EPS:

The table above reflects only line items with non-GAAP adjustments. Numbers may not add due to rounding.

Adjusted EBITDA and Adjusted EBITDA Margin

We define adjusted EBITDA as net income (loss) adjusted for interest expense (income), which includes debt financing charges and imputed interest on our liability for sale of future revenue, income tax expense (benefit) and depreciation and amortization, further adjusted to exclude purchase accounting adjustments to inventory, acquisition and divestiture-related charges, including integration and separation costs, severance, goodwill and other asset impairments, gains on sales of assets and related costs, facility exit costs, revenue sold to a third party, gains and losses on mark-to-market adjustments on equity securities, and other specified significant items, such as unusual or non-recurring items that are unrelated to our long-term operations.

For the periods presented, we have not made adjustments for all items that may be considered unrelated to our long-term operations. We believe adjusted EBITDA, when used in conjunction with our results presented in accordance with GAAP and its reconciliation to net income (loss), enhances investors’ understanding of our performance, valuation and prospects for the future. We also believe adjusted EBITDA is a measure used in the animal health industry by analysts as a valuable performance metric for investors. The following is a reconciliation of GAAP reported net (loss) income for the three months and years ended December 31, 2025 and 2024, to EBITDA, adjusted EBITDA and adjusted EBITDA margin, which we define as adjusted EBITDA divided by total revenue, less royalty revenue sold to a third party, for the respective periods:

Numbers may not add due to rounding.

Gross and Net Debt and Net Leverage Ratio

We define gross debt as the sum of the current portion of long-term debt and long-term debt excluding unamortized debt issuance costs. We define net debt as gross debt less cash and cash equivalents and finance lease liabilities on the balance sheet. We define our net leverage ratio as net debt divided by our trailing twelve month adjusted EBITDA. We believe our net debt and net leverage ratio are important measures to monitor our financial flexibility, liquidity and capital structure and may enhance investors’ understanding of our ability to meet future financial obligations. In addition, a net leverage ratio is a financial measure that is frequently used by investors and creditors. The below calculations do not include covenant-related adjustments that reduce our net leverage ratio. The following is a reconciliation of gross debt to net debt as of December 31, 2025:

The following table presents a calculation of our net leverage ratio as of December 31, 2025:

Investor Contact: Tiffany Kanaga (765) 740-0314 or [email protected] 

Media Contact: Colleen Parr Dekker (317) 989-7011 or [email protected]

SOURCE Elanco Animal Health

Today, in the UK, Ingka Group announced plans for a Decathlon store to open within the IKEA store in Croydon – marking the first time the retailer will host another global brand in one of its ‘blue boxes’. The Decathlon store will be a standalone unit with a dedicated customer entrance, spanning 1,188 m² of retail space inside the 25,000 m² IKEA store. Customers will not have to wait long, with the doors set to open this spring.

Croydon will be the first IKEA store in the UK to pilot this concept, after similar cooperations have been announced in other IKEA markets. In Austria, the company is investing EUR 11 million in the biggest revamp of its store in Klagenfurt since it opened 17 years ago. Once the renovation is completed in fall 2026, about 2,600 m² will be made available for other retailers, including Thomas Philipps, the discount home and garden specialist. On top, customers will experience new interactive areas for families as well as added home furnishing inspiration.

In Sweden, IKEA has launched a pilot with Kjell & Company, a Nordic consumer electronics retailer, in its two stores in Stockholm and Kalmar. The in-store offer focuses on smart home and technology products that complement the IKEA offer. The pilot in Sweden has been running since late 2025 for an initial 18-month period, enabling learning and evaluation before potential next steps.

Ingka Group will continue to optimise its retail spaces in additional countries to offer customers more convenience and reasons to visit IKEA stores. For the period of FY24-26, the company is investing more than EUR 5 billion in opening new locations and improving the existing ones across most of its 32 markets.

About Ingka Group 

With IKEA retail operations in 32 markets, Ingka Group is the largest IKEA retailer and represents 87% of IKEA retail sales. It is a strategic partner to develop and innovate the IKEA business and help define common IKEA strategies. Ingka Group owns and operates IKEA sales channels under franchise agreements with Inter IKEA Systems B.V. It has three business areas: IKEA Retail, Ingka Investments and Ingka Centres. Read more on Ingka.com.

Hapag-Lloyd and DSV have signed a two-year Ship Green framework agreement for the purchase of Scope 3 greenhouse gas (GHG) emission reductions. The reductions will be generated through the use of sustainable marine fuels within Hapag-Lloyd’s fleet.

The expansion of the partnership comes on the back of an already successful cooperation between DSV and Hapag-Lloyd on sustainable marine biofuels, which was implemented back in 2022.

Under the new agreement, DSV has contracted a total of 18,000 tonnes of CO₂e emission reductions on a well-to-wake (WTW) basis. The contracted period starts in 2026, during which the emission reductions will be generated using second-generation biofuels produced from waste- and residue-based feedstocks supporting tangible and verifiable progress toward net-zero ocean transport.

In addition to second-generation biofuels, the agreement allows for the inclusion of other sustainable fuel sources, making it the first of its kind. Through this agreement, Hapag-Lloyd and DSV are sending a strong signal to the market and reinforcing their shared commitment to accelerating scalable, future-ready decarbonisation solutions for ocean freight.

“We are very pleased to further strengthen our collaboration with DSV through this agreement,” said Danny Smolders, Managing Director Global Sales at Hapag-Lloyd. “Both companies share a clear ambition to accelerate the decarbonisation of global supply chains. By working closely together, we can turn this ambition into action. This agreement demonstrates how carriers and forwarders can jointly drive meaningful progress and scale lower-emission shipping solutions.”

“This agreement is an important step in our joint efforts to decarbonise global shipping at a crucial time for the green transition. Sustainable marine fuels are a tangible and scalable solution to reducing CO₂ emissions, and through close collaboration with Hapag-Lloyd, we are enabling our customers to decarbonise their supply chains,” said Michael Hollstein, Head of Ocean Product at DSV.

Scalable climate action

The agreement is based on a book-and-claim chain-of-custody mechanism that allows customers to claim verified emission reductions, regardless of the physical fuel allocation to specific vessels or routes. Only emissions avoidance from biofuel that has already been used in Hapag-Lloyd’s owned and operated fleet is allocated to DSV. This model enables scalable climate action while sustainable marine fuels remain limited in availability.

Both companies are committed to ambitious climate goals. Hapag-Lloyd aims to achieve net-zero fleet operations by 2045, while DSV has committed to reaching net-zero emissions across its own operations and value chain by 2050. Offering sustainable logistics solutions to customers is a key lever to achieve these goals.

Hapag-Lloyd has used second-generation biofuels for several years and expanded its sustainable fuels portfolio to include biomethane in 2024. Through Ship Green, Hapag-Lloyd offers customers the possibility to claim verified emission reductions by using sustainable marine fuels instead of conventional fossil marine fuel oil (MFO).

Biofuels currently represent the most available and scalable option in sea freight. As a global leader in transport and logistics, DSV actively works with customers to increase their uptake of biofuels, thus accelerating the transition.

By working together and leveraging sustainable marine fuels and the book and claim approach, DSV and Hapag-Lloyd are contributing to the shipping industry’s transition toward a more sustainable future.

Dubai, UAE: 24 February 2026 – Dubai International Financial Centre (DIFC), the leading global financial centre in the Middle East, Africa and South Asia (MEASA) region, today launched the first report in its 2026 Future of Finance series.

Titled Global Wealth Outlook: Rethinking growth in a changing world, the report examines how global wealth is being reshaped by volatility, demographic change and shifting capital flows. The world’s high-net-worth individual (HNWI) population of nearly 23mn individuals who collectively hold close to USD 87trn in wealth reinforces the scale and influence of this cohort on global capital markets. Against this backdrop, the report underscores Dubai’s emergence as a destination of choice for HNWIs, family offices and global private capital as investors actively seek portfolios and markets that can deliver diversification, flexibility and resilience.

Global realignment of wealth strategies

The report highlights a structural realignment in global wealth management. In an environment marked by persistent market volatility, geoeconomic uncertainty and increasingly uneven investment outcomes, wealthy individuals and families are rethinking both how and where capital is deployed. Geography is increasingly treated as a portfolio consideration alongside asset allocation, as jurisdictional risk becomes a defining factor in long-term wealth preservation.

A central force behind this shift is the USD 124trn intergenerational wealth transfer expected to take place by 2048. As younger heirs assume greater influence, investment strategies are evolving towards private markets, artificial intelligence, sustainability and impact, alongside traditional return objectives.

Next-generation wealth holders now pursue multi-dimensional prosperity – financial gains alongside resilience against drawdowns and inflation, portfolio flexibility for unexpected events, family unity across generations, tangible environmental and societal impact, and a solid family reputation.

The report mentions that women, who now represent over a tenth of ultra-high-net-worth individuals (UHNWIs), are poised to capture 95 per cent of USD 54trn in inter-spousal transfers. Female heirs typically prioritise investments that reflect their ethics and social impact interests, such as sustainable, philanthropic or innovative projects. HNWIs are also increasingly drawn to AI’s potential to deliver tangible societal progress, particularly in healthcare, education and resource use.

Following AI, renewable energy is poised for the fastest growth trajectory in the coming years with sustainable investments featuring more prominently in UHNWI portfolios, according to the report. The ultra-wealthy are moving beyond the rhetoric on sustainability and backing their convictions with significant financial investments.

Wealth advisers are now expected to go beyond understanding valuations and portfolio construction. They must master private deal structures, identify credible venture and growth-stage partners and integrate data-driven analytics and insights into their own advisory practices. The report also finds that despite technological advancements, wealth management remains a people-centric business. Advisers must build trust, navigate complex family dynamics and understand the unique goals and values of each family.

His Excellency, Arif Amiri, Chief Executive Officer of DIFC Authority, said: “The global wealth landscape is undergoing a structural shift. In an environment of volatility, regulatory divergence and generational change families are thinking about risk, resilience and long-term growth. Increasingly, geographical allocation is becoming as important as how wealth is invested. Dubai, and in particular DIFC, has anticipated this shift and offers a stable and globally connected environment with regulatory clarity in which families and private investors can make long-term decisions with confidence.”

Dubai’s private and family wealth advantage

The outlook underscores Dubai’s position as a leading global hub for private and family wealth by combining the institutional depth of established financial centres with the agility, stability and tax efficiency sought by globally mobile investors. Henley & Partners estimates that the UAE attracted approximately 9,800 new millionaires in 2025 – most of those in Dubai – representing the highest net inflow globally amidst shifting tax and policy environments in traditional financial centres.

With more than 1,289 family-related entities, representing the largest family wealth ecosystem in the UAE, DIFC underpins Dubai’s rise as a magnet for private wealth. Supported by a comprehensive ecosystem spanning private banking, wealth and asset management, legal and advisory services, this growth is in direct alignment with the UAE’s designation of 2026 as the Year of Family, reflecting the increasingly pivotal role families play in global wealth stewardship.

The report also highlights the rapid professionalisation of family offices and wealth managers, as clients demand deeper private market access, AI-enabled analytics and more sophisticated governance and advisory capabilities. DIFC is continuing to expand its wealth infrastructure to meet these needs, most notably through the DIFC Family Wealth Centre, a world-first initiative dedicated to supporting multi-generational families. The Centre serves as a hub for thought leadership, peer networking and next-generation engagement, reinforcing DIFC’s role as more than a financial centre, but a long-term partner to families.

The Global Wealth Outlook: Rethinking growth in a changing world report underscores how Dubai is not only responding to shifts in global wealth, but actively shaping the environment in which private and family capital can thrive. To learn more, please visit the following link.

Tokyo, February 24, 2026 – Mitsubishi Shipbuilding Co., Ltd., a part of Mitsubishi Heavy Industries (MHI) Group, has shipped an ammonia fuel supply system (AFSS) and an ammonia gas abatement system (AGAS) for Japan Engine Corporation (J-ENG). Both systems are designed for the first ammonia-fueled marine engine model 7UEC50LSJA-HPSCR manufactured by J-ENG and represent the first units produced by Mitsubishi Shipbuilding. Commissioning work for the systems will begin in due course.

The AFSS supplies ammonia fuel to the engine in a stable and safe manner, while the AGAS safely processes surplus ammonia generated during fuel switching from ammonia to conventional fuel oil. Both systems support remote operation and automatic control through an integrated control system, enhancing operational efficiency and safety.

The early market introduction of these systems will enable onboard verification combining J-ENG’s ammonia fueled marine engine model 7UEC50LSJA-HPSCR, a first mover in next-generation advanced fueled engines, with Mitsubishi Shipbuilding’s AFSS and AGAS. This combination is expected to further accelerate decarbonization efforts across the maritime industry.

Mitsubishi Shipbuilding will continue strengthening its business structure to meet the growing demand for ammonia-fueled vessels.

Pearce IP provides weekly reports on global biosimilars activities in the Pearce IP BioBlast®. Significant biosimilar activities for the week ending 20 February 2026 are set out below:

Abatacept

Aflibercept

Bevacizumab

Daratumumab

Filgrastim

Nivolumab, Pertuzumab

Pembrolizumab

Ranibizumab

On 19 February 2026, Gina Cass-Gottlieb, Chair of the Australian Competition and Consumer Commission (ACCC), announced the ACCC’s 2026-27 Compliance and Enforcement Priorities. The ACCC reaffirmed its enduring priorities to target cartel conduct, anti-competitive conduct, and product safety and scams enforcement. New and continuing priorities include pricing transparency in supermarket, retail, electricity and gas sectors, manipulative conduct in digital markets, and improved industry compliance with consumer guarantee rights.

Enduring priorities remain, with cost of living pressures in particular focus

The ACCC remains focused on combating cartel and anti-competitive conduct, addressing product safety concerns, protecting vulnerable and First Nations consumers as well as small business and agriculture and combatting scams. This year, the ACCC will also prioritise cost of living issues by targeting misleading pricing in supermarkets, retail, energy, and telecommunications. Additional priorities include competition in the aviation sector, strengthening compliance with consumer guarantees, and promoting competition in digital markets.

New and targeted annual priorities for 2026-2027

To address cost of living concerns and emerging regulatory risks, the ACCC has announced the following annual priorities:

Australia’s new merger regime

While not a specific compliance and enforcement priority, ensuring compliance with the Australia’s new mandatory new merger regime is a key focus for the ACCC. Following a six month transition, the regime came into full effect on 1 January 2026.
Under the new regime:

• Since 1 July 2025, the ACCC received 31 merger notifications, of which 15 were approved and 16 are under assessment.
• Since 1 January 2026, the ACCC has approved 23 and denied 3 applications for notification waivers.
• Approximately 80% of notification and waiver applications have been determined by the ACCC within 20 business days.

The ACCC acknowledged that as the demands on the ACCC’s resources increase and regime stretches the regulator, the regime could impact enforcement of non-merger matters. As the ACCC noted when introducing the merger regime last year, the regime operates most effectively where the merger parties approach the ACCC early and co-operatively.

Conclusion

The ACCC’s compliance and enforcement priorities for 2026-27 demonstrate its broad legislative mandate of protecting and promoting competition across the Australian economy, with a particular focus on addressing cost of living pressures and emerging digital economy risks.

For businesses and their advisers, the announcement provides clear guidance on regulatory risk areas and the sectors facing heightened scrutiny. The announcement highlighted that enduring priorities are still central to the ACCC’s enforcement focus and that proactive compliance reviews and strengthening of compliance culture will be essential to mitigate enforcement risk in a heightened regulatory environment. Businesses operating in priority sectors should treat the ACCC’s priorities as a roadmap for immediate compliance action.

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