Specialty pharmaceutical and medication delivery company Hospira Inc. (HSP) on Tuesday posted a sharp growth in third-quarter profit, boosted by the launch of the generic oncolytic oxaliplatin and additional progress toward its Project Fuel initiatives. In addition, the company lifted its financial guidance for the full year.
The Lake Forest, Illinois-based company's third-quarter net income was $116.2 million, up 42.1% from $81.8 million in the prior-year quarter. On a per share basis, earnings rose 39.2% to $0.71 from $0.51 in the same quarter of last year.
Adjusted net income for the latest quarter totaled $147.4 million, a jump of 45.2%, compared to $101.5 million reported a year ago. Adjusted per share earnings climbed 42.9% to $0.90 from $0.63 in the comparable quarter of the previous year.
On average, 8 analysts polled by Thomson Reuters expected the company to post earnings of $0.69 per share. Analysts' estimates typically exclude special items.
Quarterly net sales advanced 8.9% to $1.01 billion from the previous year's net sales of $925.5 million, led by an increase in Specialty Injectable Pharmaceuticals, primarily a result of the third-quarter launch of oxaliplatin in solution form in the United States. Six Wall Street analysts had a consensus revenue estimate of $936.22 million for the quarter.
Christopher Begley, chairman and chief executive officer of Hospira, said, "We continued to position Hospira for future success in this milestone quarter, during which we surpassed the billion dollar revenue mark for the first time and generated strong double-digit earnings per share growth."
Third-quarter sales of the the Americas product line grew 13.8% to $803.4 million from $705.7 million in the previous year, while sales from the Europe, Middle East & Africa decreased 11.6% to $129.6 million from the prior-year's sales of $146.6 million. Total Asia Pacific sales improved 1.8% to $74.5 million from $73.2 million in the comparable quarter of the previous year.
Global pharmaceuticals segment rose 14.3% to $733.1 million from $641.5 million a year ago, and Devices unit fetched quarterly sales of $274.4 million, down 3.4% from $284.0 million in fiscal 2008.
For the nine-month period, the company reported net income of $307.2 million or $1.89 per share, compared to $216.3 million or $1.34 per share in the year-earlier period.
Adjusted net income increased to $362.4 million or $2.23 per share, compared to $281.8 million or $1.75 per share in the same period of last year.
Net sales for the nine months ended September 30, 2009 totaled $2.82 billion, up 4.0% from $2.72 billion in the corresponding period of the previous year.
Looking ahead, the company now projects fiscal 2009 adjusted earnings to range between $2.85 and $2.90 per share, compared to the previously communicated range of $2.70 - $2.75 per share. GAAP earnings are estimated to be in the range of $2.25 - $2.30 per share, versus the prior projection of $2.10 - $2.15 per share. In addition, Hospira continues to forecast full year sales to increase about 5% - 7% on a constant-currency basis. Including the impact of foreign exchange, the company expects net sales to be slightly up. Analysts are looking for earnings of $2.84 per share on revenue of $3.73 billion for the full year.
The company now anticipates cash flow from operations in 2009 in the $700 million - $750 million range. Depreciation and amortization is now expected to be between $225 million and $235 million, and capital expenditures are projected to be between $155 million and $175 million.
Among Hospira's rivals, Baxter International Inc. (BAX) last week posted higher profit for the third quarter that totaled $530 million or $0.87 per share, compared to $472 million or $0.74 per share a year ago, helped by margin expansion and lower expenses, despite near-flat revenues. Net sales were $3.145 billion, compared to $3.151 billion in the prior year quarter. Excluding the impact of foreign currency, Baxter's worldwide sales increased 6%.
For the fourth quarter of 2009, Baxter expects earnings to be in the range $1.02 - $1.04 per share, before any special items. Baxter expects fourth-quarter sales growth, excluding the impact of foreign currency, of 6% to 8%. Reported sales including the impact of foreign currency are expected to increase 8%-10% in the fourth quarter over the prior-year period. Baxter raised its full year 2009 earnings, before any special items, outlook to a range of $3.79 - $3.81 per share from the prior range of $3.76 - $3.80 per share.
Hospira shares, which have been trading between $21.21 and $47.54 in the past 52 weeks, closed Monday's trading session at $46.30.
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