2nd UPDATE: Hospira 3Q Profit Jumps 42% Behind Generic Drug
28 10월 2009 - 12:45AM
Dow Jones News
Hospira Inc.'s (HSP) third-quarter profit jumped 42%, beating
analyst' expectations by a wide margin as a new generic version of
a Sanofi-Aventis SA (SNY, SAN.FR) colon-cancer drug quickly ramped
up sales.
It looks like a short-term benefit for Hospira, however, which
doesn't expect the drug to help much in the fourth quarter. The
maker of injectable drugs and medical devices affirmed its
full-year sales-growth outlook and modestly increased its
twice-raised 2009 earnings guidance due to a tax benefit.
Shares of the Lake Forest, Ill., company recently traded up 54
cents, or 1.2%, to $46.84. Through Monday, Hospira shares had risen
about 73% on the year.
The company reported earnings of $116.2 million, or 71 cents a
share, up from $81.8 million, or 51 cents a share, a year earlier.
Excluding one-time items, including charges linked to a
restructuring plan in the recent quarter, earnings rose to 90 cents
from 63 cents.
Analysts surveyed by Thomson Reuters had forecast, on average,
earnings of 69 cents in the recent quarter.
Gross margin rose to 39.3% from 36.1%.
Quarterly sales for Hospira, which spun off from Abbott
Laboratories (ABT) in 2004, topped the 1 billion mark for the first
time by reaching $1.01 billion, far ahead of Wall Street's $936.2
million projection.
Sales were up 8.9% from a year ago, or 10.8% excluding the
impact of foreign currency.
The driver was Hospira's business for specialty injectable
drugs, where sales surged about 24% to $575.7 million. Due in part
to unfavorable currency rates, other major product categories saw
year-over-year declines in the third quarter.
Christopher B. Begley, Hospira's chairman and chief executive,
said in a release that results were helped by the restructuring
program started in March and the U.S. launch this summer of a
generic version of the Sanofi drug, which is known as Eloxatin.
Hospira didn't define the drug's sales but did say it got off to
a fast start that won't repeat. "We believe that sales from future
quarters were accelerated into the third quarter," Thomas E.
Werner, Hospira's chief financial officer, said on a conference
call. He added that Hospira doesn't expect significant
fourth-quarter sales from the drug, known generically as
oxaliplatin.
There is an ongoing patent fight concerning the drug, and a
federal appeals court ruled in Sanofi's favor in September while
throwing out an earlier trial-court ruling in favor of generic
competitors including Hospira. Hospira kept shipping the drug,
however, and Begley said on the call that "we feel very confident
in our legal position."
The restructuring plan announced in March, called "Project
Fuel," includes a 10% work force reduction and the slimming down of
Hospira's product offerings alongside the potential sale of
non-core businesses.
Hospira backed its forecast for 5% to 7% sales growth this year
excluding the impact of foreign currency. Based on a tax benefit,
the company hiked its adjusted earnings guidance by 5 cents to a
range of $2.85 to $2.90 per share. Including items, full-year
earnings are seen at $2.25 to $2.30 a share.
Regarding the sales outlook, Werner also said that most expected
sales benefits related to making pandemic flu vaccine for other
companies have been pushed out to next year. He also said Hospira
doesn't see any positive changes regarding a slow-down in hospital
spending that has hurt sales of medical devices.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728;
jon.kamp@dowjones.com