Elanco Animal Health Inc. (ELAN) shares surged over 5% in the pre-market session on Wednesday, following the company's impressive fourth-quarter results and optimistic guidance for 2025.

The animal health company reported better-than-expected earnings for the fourth quarter of 2024. Key highlights include:

• Revenue of $1.02 billion, representing a 4% organic constant currency growth
• Adjusted EBITDA of $177 million, an increase of $12 million year-over-year
• Adjusted EPS of $0.14, beating analyst estimates by $0.06

Elanco's strong performance was driven by solid growth in its Pet Health and US Farm Animal segments, as well as robust innovation revenue from new product launches. The company successfully rolled out six potential blockbuster products in 2024, exceeding its innovation revenue target.

Additionally, Elanco made significant progress in reducing its debt burden, paying down $1.475 billion in debt throughout the year. This helped improve the company's net leverage ratio to 4.3 times by year-end, down from 5.6 times at the start of 2024.

Looking ahead, Elanco provided an optimistic outlook for 2025, forecasting mid-single-digit organic constant currency revenue growth and adjusted EBITDA between $830 million and $870 million. The company expects its innovative product pipeline and continued market share gains to drive growth, despite anticipated headwinds from foreign exchange and increased operating expenses.