Drug distributor AmerisourceBergen Corp. (ABC), Thursday, reported a profit for the third quarter, helped by strong generic sales and an increased contribution from fee-for-service agreements. The company also said it expects to achieve high end of its previous earnings guidance for fiscal 2009.
The company posted net income of $118.8 million or $0.40 per share for the third quarter, compared to a loss of $108.0 million or $0.34 per share in the prior-year quarter. The company noted that its earnings per share reflect its June 2009 two-for-one stock split.
Income from continuing operations rose to $125.1 million or $0.42 per share from $112.8 million or $0.35 per share in the previous year quarter.
On average, 16 analysts polled by Thomson Reuters expected the company to earn $0.39 per share for the third quarter. Analysts' estimates typically exclude speical items.
Third quarter total revenue increased 2.2% to $18.4 billion from $18.0 billion in the same quarter of last year, due to a 2% growth in AmerisourceBergen Drug Corp. revenue, which was driven primarily by new business, and a 6% increase in AmerisourceBergen Specialty Group revenue. Nine analysts had a consensus revenue estimate of $18.11 billion for the third quarter.
Gross profit in the third quarter grew 4% to $519.2 million from $498.0 million in the year-ago quarter, helped by strong generic sales and an increased contribution from fee-for-service agreements.
For the nine-month period of 2009, AmerisourceBergen reported net income of $373.3 million or $1.22 per share, compared to $135.7 million or $0.41 per share in the previous year period.
Total revenue for the year-to-date period remained flat at $53.0 billion. Adjusted for the negative impact of the loss of the direct-to-warehouse business of a large retail drug chain, revenue grew by about 4%.
Looking ahead, for the fourth quarter, the company expects to achieve the higher end of the $0.34 to $0.40 per share range guidance. Analysts expect earnings of $0.40 per share for the fourth quarter.
For fiscal year 2009, AmerisourceBergen currently expects earnings from continuing operations to be at the higher end of its previously estimated range of $1.59 to $1.65 per share, and revenue growth of between 1% and 3%. Street estimates the company to report earnings of $1.63 per share for the year.
The company continues to expect to repurchase about $350 million of AmerisourceBergen common shares in fiscal 2009.
AmerisourceBergen is currently trading at $19.83, up 53 cents or 2.75% on a volume of 2.41 million shares.
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