Mylan's profit drops 25% in third quarter on charges
Generic drugmaker Mylan Inc. reported a 25 percent drop in profit in the third quarter on charges and lower revenue from new products in North America.
The company said its $1.6 billion acquisition of an Indian maker of sterile injectable drugs is on track to close by the end of this year, and it plans a buyback of up to $500 million in stock.
Cecil-based Mylan said net income in the July-September quarter was $158.9 million, or 40 cents a share, compared with $211.3 million, or 51 cents a share, in the same period last year.
Earnings were reduced by charges of $70.6 million, primarily related to the redemption of outstanding debt.
Removing the impact of the charges, adjusted net income was 82 cents a share, down slightly from 83 cents a share last year.
By that measure, Mylan's performance beat Wall Street expectations. Analysts had expected adjusted net income of 79 cents a share, according to Bloomberg.
But revenue of $1.77 billion in the quarter, which was down slightly compared with last year, missed analyst estimates of $1.84 billion.
Standard & Poor's analyst Herman Saftlas called the quarterly results “disappointing.” But he said Mylan appears to be on track to continue its growth and strong earnings in the future.
“The core drivers are on track, and they have consistently delivered on their projections and their guidance,” Saftlas said. “This quarter was a little bit of an anomaly.”
Sales of new generic drugs introduced in the quarter in North America declined compared with a year ago for Mylan. But the decline was offset by higher sales outside the region.
Mylan said generic medications introduced during the quarter brought in $108 million in North America, down substantially from the $299 million that new drugs contributed to revenue last year. But sales of generics in all other parts of the world increased, CEO Heather Bresch said.
“Coming off an exceptional year in 2012 for both Mylan and our industry, we delivered double-digit constant currency growth in our Asia-Pacific and Specialty businesses, and saw continued strength in Europe,” Bresch said.
Mylan expects to close on its purchase of the Agila unit of Strides Arcolab Ltd. by the end of the year, President Rajiv Malik said. Mylan announced the deal in February and in September agreed to a settlement with the Federal Trade Commission to resolve antitrust concerns over the agreement.
Under the pact, Mylan agreed to divest of seven drugs and Agila would sell four.
Mylan shares closed on Thursday at $37.87, down 55 cents.
Alex Nixon is a staff writer for Trib Total Media.