Moderna's surprise profit powered by deferred Covid orders
MODERNA on Thursday (May 4) reported a surprise profit and stronger-than-expected sales for its Covid-19 vaccine in the first quarter, as it received payments for orders that were deferred last year.
The vaccine maker posted a profit of 19 US cents per share, compared with analysts’ expectations for a loss of US$1.77 per share, in part because sales were higher than expected.
The US$1.83 billion of sales for its Covid vaccine Spikevax represents most of the US$2 billion expected in the first half of the year for advanced purchase agreements and double the average analyst estimate of US$998 million, according to Refinitiv IBES data.
Moderna expects an additional US$3 billion in deferred vaccine revenue in the second half of 2023.
The company said it continued to expect Covid vaccine sales of US$5 billion for the year, based on advance purchase agreements. It added it was having discussions about new contracts with customers in Europe, Japan, and in the US.
The company expects to sign commercial contracts for updated Covid vaccine boosters over the next few weeks and into the third quarter, chief commercial officer Arpa Garay said in an investor call.
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Moderna continues to expect the US annual Covid-19 market to be 100 million doses, she added.
“Today’s beat and 2023 reiteration of guidance along with ongoing negotiations in 3 regions should support some confidence on the 2023 base business of US$5 billion to US$7 billion,” said Jefferies analyst Michael Yee.
Moderna’s shares were up 2 per cent in morning trade in a broadly weaker market.
The results came two days after rival Pfizer reported better-than-expected Covid vaccine sales for the first quarter and maintained its expectations for full-year sales.
Moderna trails Pfizer in share of the global Covid vaccine market, with the latter holding nearly two-thirds, said TD Cowen analyst Tyler Van Buren, ahead of the shot moving into the commercial market from government procurement in the US.
Moderna said on Thursday it now expects a tax benefit of US$300 million to US$500 million for the year due to credits for research and development and certain one-off items.
The company had generated around US$36 billion in sales over the last two years from its Covid vaccine, its only commercial product and one of the most widely used shots for the virus.
Demand for the vaccine has since fallen globally, and the company in February effectively forecast a possible net loss for 2023, calling it a transition year before it starts sales of its potential new vaccines for respiratory syncytial virus (RSV) and flu.
All of its vaccines are based on the same mRNA platform as its Covid product. REUTERS
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