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Zoetis Inc. (NYSE:ZTS)

This company has been moved to the archive! The financial data has not been updated since May 2, 2024.

Common-Size Income Statement
Quarterly Data

Zoetis Inc., common-size consolidated income statement (quarterly data)

Microsoft Excel
3 months ended: Mar 31, 2024 Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Revenue 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00
Cost of sales -29.36 -32.90 -29.66 -27.84 -29.40 -32.01 -30.32 -30.46 -28.65 -30.50 -29.45 -29.16 -29.34 -33.26 -30.57 -29.13 -29.92 -31.66 -30.24 -30.06 -35.60
Gross profit 70.64% 67.10% 70.34% 72.16% 70.60% 67.99% 69.68% 69.54% 71.35% 69.50% 70.55% 70.84% 70.66% 66.74% 69.43% 70.87% 70.08% 68.34% 69.76% 69.94% 64.40%
Selling, general and administrative expenses -24.98 -25.53 -24.41 -25.50 -25.25 -25.20 -25.02 -25.78 -23.41 -30.15 -25.33 -25.41 -21.86 -28.78 -23.74 -25.39 -25.36 -28.20 -24.68 -26.24 -25.36
Research and development expenses -7.40 -7.86 -7.07 -6.70 -7.10 -7.25 -6.69 -6.58 -6.14 -7.02 -6.63 -6.16 -6.31 -7.36 -6.27 -7.17 -6.98 -7.89 -7.07 -7.18 -7.01
Amortization of intangible assets -1.69 -1.67 -1.77 -1.70 -1.85 -1.72 -1.85 -1.80 -2.06 -2.03 -2.01 -2.10 -2.14 -2.21 -2.24 -2.58 -2.61 -2.39 -2.40 -2.52 -2.61
Restructuring charges and certain acquisition-related costs -0.18 -0.36 -0.74 -0.37 -1.05 -0.10 -0.30 -0.05 -0.10 -0.20 -0.45 -1.08 -0.48 -0.17 -0.28 -0.52 -0.59 -1.08 -0.38 -1.42 -0.34
Operating income 36.39% 31.68% 36.36% 37.89% 35.35% 33.73% 35.81% 35.33% 39.63% 30.10% 36.13% 36.09% 39.87% 28.22% 36.90% 35.21% 34.55% 28.79% 35.23% 32.58% 29.07%
Interest expense, net of capitalized interest -2.65 -2.67 -2.74 -2.66 -3.15 -3.04 -2.65 -2.58 -2.67 -2.75 -2.81 -2.93 -3.05 -3.21 -3.47 -3.75 -3.46 -3.35 -3.54 -3.56 -3.85
Other income (deductions), net 0.37 0.36 -0.28 4.77 2.65 -1.67 0.15 -0.10 -0.35 -1.63 -0.20 -0.51 -0.11 -1.77 0.00 -0.32 1.30 0.66 1.64 0.39 0.96
Income before provision for taxes on income 34.11% 29.37% 33.33% 40.00% 34.85% 29.02% 33.32% 32.65% 36.61% 25.72% 33.12% 32.65% 36.72% 23.24% 33.43% 31.14% 32.40% 26.11% 33.33% 29.41% 26.19%
Provision for taxes on income -6.76 -5.74 -5.63 -9.27 -7.30 -6.47 -6.94 -6.87 -6.70 -4.73 -5.38 -6.42 -6.89 -3.43 -6.61 -6.85 -4.82 -3.17 -6.00 -5.43 -4.74
Net income before allocation to noncontrolling interests 27.35% 23.63% 27.71% 30.73% 27.55% 22.55% 26.37% 25.78% 29.91% 21.00% 27.74% 26.23% 29.82% 19.81% 26.82% 24.29% 27.57% 22.94% 27.34% 23.98% 21.44%
Net loss attributable to noncontrolling interests 0.00 0.09 0.00 0.05 0.05 0.05 0.05 0.00 0.05 0.05 0.00 0.05 0.05 0.06 0.00 0.06 0.00 0.00 0.00 0.00 0.00
Net income attributable to Zoetis Inc. 27.35% 23.72% 27.71% 30.78% 27.60% 22.60% 26.42% 25.78% 29.96% 21.05% 27.74% 26.28% 29.88% 19.87% 26.82% 24.35% 27.57% 22.94% 27.34% 23.98% 21.44%

Based on: 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-K (reporting date: 2019-12-31), 10-Q (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31).

The common-size income statement analysis reveals a period of sustained profitability and relatively stable cost structures between March 2019 and March 2024. The company maintains high gross margins and consistent operational discipline, although certain fluctuations in operating expenses and tax provisions impact the final net income margins.

Gross Profitability and Cost of Sales
Gross profit margins remain consistently high, typically oscillating between 67% and 72%. The cost of sales has generally trended lower from a peak of 35.60% in March 2019 to a range of 28% to 33% in subsequent years. A notable peak in gross margin occurred in June 2023, reaching 72.16%, indicating periods of enhanced production efficiency or favorable pricing dynamics.
Operational Expense Trends
Selling, general, and administrative (SG&A) expenses represent the most volatile component of operating costs, ranging from a low of 21.86% in March 2021 to a high of 30.15% in December 2021. Research and development (R&D) spending is characterized by high stability, consistently remaining between 6.1% and 7.9% of revenue, suggesting a disciplined and steady investment in innovation. Amortization of intangible assets shows a gradual downward trend, decreasing from approximately 2.6% of revenue in early 2019 to 1.69% by March 2024.
Operating Income Performance
Operating margins demonstrate strong performance, frequently exceeding 30%. The operating income percentage peaked in March 2021 at 39.87% and March 2022 at 39.63%. While there are quarterly dips, often coinciding with higher SG&A or restructuring charges, the overall operational efficiency remains robust, with a baseline operating margin typically settling above 30%.
Financial Costs and Net Income
Net interest expenses as a percentage of revenue have experienced a steady decline, moving from 3.85% in March 2019 to 2.65% in March 2024, indicating improved debt management or reduced leverage relative to revenue growth. Net income attributable to the company fluctuates between approximately 20% and 31%. The volatility in the bottom line is largely driven by fluctuations in the provision for income taxes, which ranges from 3.17% to 9.27% of revenue, and periodic swings in other non-operating income.

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