Revenue Analysis:
Total and Operating Revenue: Growth is observed in Operating and Total Revenue across the time periods. From 2023 Q1’s $6.96 billion, there’s a consistent increase each quarter to $9.50 billion by 2023 Q3. The revenue again spikes to $9.35 billion in 2023 Q4 and to $8.77 billion by 2024 Q1. Such growth indicates strong sales execution and market demand.
Gross Profit Margins: Steadily increasing from $5.33 billion in 2023 Q1 to $7.64 billion in 2023 Q3, and marginally declining thereafter to $7.09 billion by 2024 Q1. This shows that despite the revenue growth, cost of sales might be impacting gross profitability slightly.
Cost Management:
Cost of Revenue: Increased from $1.63 billion in 2023 Q1 to $1.87 billion in 2023 Q3, indicating rising costs against revenue which could be connected to ramping up production or higher material costs.
Operating Expense: The overall expenditure varies, with $4.17 billion recorded in 2023 Q1 increasing to $4.21 billion by 2023 Q3, showing slightly elevated operating costs, correlating with revenue augmentation.
Total Expenses: Increasing from $5.25 billion in 2023 Q1 to around $6.07 billion by 2023 Q3 and slightly stabilizing close to this number into 2023 Q4 and 2024 Q1.
Profitability Analysis:
EBITDA: Exhibits growth from $1.99 billion in 2023 Q1 to $4.00 billion in 2023 Q3, but declines to $3.12 billion by 2024 Q1. This indicates operational efficiency but also potential variability in profit-making components.
Operating Income: Increased notably from $1.71 billion in 2023 Q1 to $3.43 billion in 2023 Q3, drops to $2.74 billion by 2024 Q1, showing that income from operations can fluctuate.
Pretax Income and Net Income: Following a similar trend, both metrics peak in 2023 Q4 with $2.51 billion pretax and $2.19 billion net but see a reduction in 2024 Q1 to $2.54 billion pretax and $2.24 billion net, indicating some pressures on bottom-line results.
Cash Flow Indicators:
Reconciled Depreciation: The depreciation costs have a slight uptick indicating persistent investment in capital assets, crucial for long-term sustainability.
Interest Expense: Remains stable, showing soundness in financial management concerning interest obligations.
Taxation:
Tax Rate For Calcs: Slightly fluctuating tax rates, touching a high of about 21% in 2023 Q3 before stabilizing around 11-16% in other quarters.
Tax Provision: Varied from $184.8 million in 2023 Q1 reaching up to $484.6 million in 2023 Q3, tightening to $293.2 million by 2024 Q1.
Tax Effect of Unusual Items: Showing substantial negatives, especially in 2023 Q3 with nearly $638 million, which significantly impacts the taxation context.
Shareholder Metrics:
Diluted and Basic EPS: EPS shows volatility, especially highlighted by a drop in 2023 Q3 to a negative EPS but recovers strongly thereafter. This is crucial for investor perceptions.
Average Shares and Net Income Available to Common Stockholders: Shows stability, providing assurance of predictable shareholder returns and reduced dilution.
Conclusion:
LLY has demonstrated solid revenue growth and operational efficiency, despite some cost increases and profitability swings. Strategic initiatives in cost management and expanding market reach could further enhance profitability. Shareholders should be pleased with the EPS recovery and stable share metrics, though mindful of any future fluctuations.