Multi-specialty health care company Allergan, Inc. (AGN) reported Thursday a 51% year-over-year surge in profit for the fourth quarter, boosted by sales growth across all its operating segments and all products, except a marginal sales decline of one product.
Excluding items, earnings per share for the quarter increased 2.6% from a year ago and topped analysts' expectations by a penny. Looking ahead, the specialty drug maker also provided earnings and revenue forecast for the first quarter and the full year 2010, below consensus estimate.
In a statement, chairman and chief executive officer, David Pyott said, "The fourth quarter proved to be another strong quarter for Allergan as we benefited from the commercial investments made since mid-year and observed some recovery in our markets. In 2010 we look forward to rebuilding our cash-pay markets and to introducing some significant therapeutic innovations."
Fourth-Quarter Results
The Irvine, California-based company reported net earnings of $221.5 million or $0.72 per share for the fourth quarter, up from $146.6 million or $0.48 per share in the prior-year quarter.
Non-GAAP net income for the quarter increased to $238.1 million or $0.78 per share from $229.8 million or $0.76 per share in the year-ago quarter. On average, sixteen analysts polled by Thomson Reuters expected the company to report earnings of $0.77 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter increased to $1.22 billion from $1.06 billion in the same quarter last year, and topped sixteen Wall Street analysts' consensus estimate of $1.16 billion.
Peer Performance
Among others in the sector, Cambridge, Massachusetts-based Genzyme Corp. (GENZ) is slated to announce its fourth-quarter results on February 17. Wall Street analysts are of the view that the company will report earnings of $0.29 per share for the quarter, with revenue estimates of $1.08 billion.
Another peer, Hunenberg, Switzerland-based Alcon, Inc. (ACL) is scheduled to report financial results for the fourth quarter on Thursday, February 11. Analysts expect the company to report earnings of $1.51 per share for the fourth quarter, on revenues of $1.60 billion.
Segmental Details
Allergan's total product net sales for the fourth quarter were $1.21 billion, up 15.9%, or 11.2% on a constant currency basis, from $1.04 billion in the year-ago quarter.
During the latest quarter, sales of anti-wrinkle treatment Botox increased 5.6% to $347.7 million from $329.2 million in the prior-year quarter. In the preceding third quarter, the company reported a 3% increase in sales of Botox to $327.8 million.
Total specialty pharmaceuticals sales for the quarter increased 17.7%, or 13.1% on a constant currency basis, to $995.1 million from $845.8 million in the year-ago quarter.
Total sales of medical devices also increased 8.3%, or 3.1% on a constant currency basis, to $211.4 million from $195.2 million in the same quarter last year. Sales of Facial aesthetics rose 18.3% from the year-ago period to $66.0 million, while sales of eyelash growth enhancer Latisse during the latest quarter was $26.0 million.
Other Metrics
The company's operating income for the fourth quarter surged to $316.9 million from $183.9 million in the year-ago quarter, while adjusted operating income was $346.1 million, up from $304.5 million last year.
Operating expenses for the quarter include selling, general and administrative expenses of $497.6 million, higher than $426.6 million in the year-ago quarter, and research and development expenses of $185.4 million, lower than $215.0 million a year ago.
Provision for income taxes for the quarter rose to $73.0 million from $42.8 million in the year-ago quarter.
Allergan also announced a fourth quarter cash dividend of $0.05 per share, payable on March 12, to shareholders on record as of February 19, 2010.
On Monday, Allergan received the U.S. FDA approval for its new formulation Juvederm XC, an anti-wrinkle dermal filler, that is an improvement of its earlier FDA-approved Juvederm. The new Juvederm XC formulation also has a shorter treatment duration than the earlier Juvederm. Following FDA approval, the company said that Juvederm XC with Lidocaine is available for ordering in the U.S.
Full Year Highlights
For fiscal 2009, the company reported net earnings of $621.3 million or $2.03 per share, up from $563.1 million or $1.84 per share in the prior year.
Non-GAAP net earnings for the year rose to $849.8 million or $2.78 per share from $786.5 million or $2.57 per share in the previous year. Analysts expected the company to report earnings of $2.77 per share for fiscal 2009.
Revenues for the full year grew to $4.50 billion from $4.40 billion reported in fiscal 2008. The Street was looking for full-year 2009 revenues of 4.44 billion.
Outlook
Looking ahead to the first quarter of 2010, Allergan forecasts GAAP earnings in a range of $0.50 to $0.52 per share, and non-GAAP earnings in the range of $0.57 to $0.59 per share. Analysts currently expect the company to report earnings of $0.68 per share for the first quarter.
The company also projects total product net sales for the first quarter to be between $1.06 billion and $1.10 billion. Analysts are looking for total first-quarter revenues of $1.11 billion.
For fiscal 2010, Allergan expects GAAP earnings in a range of $2.79 to $2.85 per share, and non-GAAP earnings in the range of $3.09 to $3.15 per share. The company also projects total product net sales for the year to be between $4.55 billion and $4.75 billion. Analysts have a consensus earnings estimate of $3.15 per share for the full-year 2010, on revenues of $4.78 billion.
Total product net sales projection includes total specialty pharmaceuticals net sales of between $3.78 billion and $3.93 billion, as well as total medical devices net sales of between $770 million and $820 million. BOTOX product net sales are expected in the range of $1.33 billion to $1.37 billion.
Stock Quotes
AGN closed Wednesday's regular trading session at $56.77, up $0.13 on a volume of 3.35 million shares, higher than the three-month average volume of 1.70 million shares. In the past 52-week period, the stock has been trading in a broad range of $35.41 to $64.08.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.