Generic drug maker Mylan Inc. (MYL), Wednesday reported a better-than-expected rise in fourth-quarter profit, as new product launches lifted sales across all regions. Quarterly sales fell short of expectations, partly impacted by foreign currency losses.
For fiscal year 2013, Mylan provided broad earnings and sales guidance, with the midpoint of the range indicated to top expectations.
Mylan also agreed to acquire Agila Specialties Private Ltd., a maker of generic injectables, from India's Strides Arcolab Ltd. for $1.6 billion in cash, in a bid to expand its injectables platform and foray into high-growth markets.
The deal, which also provides for up to an $250 million in potential milestone payments, is to be immediately accretive to Mylan's adjusted earnings per share upon closing, which is expected in the fourth quarter 2013. The deal is also expected to double its business from injectables in the first full year.
By combining Agila, Mylan will have over 700 marketed injectable products and a pipeline of 350 injectables products pending approval. The duo's portfolio will represent about 70 percent of regulated market demand for injectables.
Mylan has obtained a commitment from Morgan Stanley (MS) for a new $1 billion senior unsecured bridge term loan for the deal.
Meanwhile, in Mylan's fourth quarter, third party net revenues from its Generics segment - consisting of sales in North America, EMEA, and Asia Pacific - were up 10 percent from last year.
New product launches helped sales in North America, while EMEA gained from product launches and volumes, partly offset by foreign currency losses. Asia Pacific sales benefited on higher Indian demand for generic antiretrovirals.
At Mylan Specialty segment, third party net sales jumped 38.8 percent, on strong demand for EPIPEN Auto-Injector used in the treatment of severe allergic reactions.
Overall, the Pennsylvania-based company's revenues for the quarter rose 12.5 percent to $1.72 billion from $1.53 billion in the prior year. Analysts polled by Thomson Reuters estimated revenues of $1.73 billion.
Foreign currency losses impacted revenues by about 2 percent.
Net profit for the quarter climbed to $162 million or $0.39 per share from $129.5 million or $0.30 per share last year.
Excluding items, adjusted earnings for the quarter totaled $266.9 million or $0.65 per share, compared with $226.6 million or $0.53 per share a year ago.
On average, 18 analyst polled by Thomson Reuters estimated earnings of $0.64 per share for the quarter. Analysts' estimates typically exclude one-time items.
Research and development expense for the quarter increased to $117.8 million, compared with $76 million a year ago.
For fiscal year 2013, Mylan expects net earnings of $1.06 billion to $1.18 billion, or $2.75 to $2.95 per share; and revenues of $7.00 billion to $7.40 billion.
Analysts currently estimate earnings of $2.80 per share on revenues of $7.16 billion for 2013.
Mylan said its Board approved the repurchase of up to $500 million of its common stock, which is to be completed during 2013.
Mylan closed Wednesday's regular trade at $28.57, up 0.85%, on a volume of 3.6 million shares on the Nasdaq. In after hours, the stock rose $0.73 or 2.56%. In the past year, the stock has trended in a range of $20.21 - $29.30.
by RTT Staff Writer
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