UPDATE 2-AmerisourceBergen net up as new contract boosts revs

Thu Jan 24, 2013 9:19am EST

Jan 24 (Reuters) - Pharmaceutical distributor AmerisourceBergen Corp said on Thursday that quarterly earnings rose as revenue was boosted after it won a contract with giant pharmacy benefit manager Express Scripts earlier this year.

Net income totaled $168.6 million, or 71 cents per share, in the fiscal first quarter ended Dec. 31, up from $162 million, or 62 cents per share, a year earlier.

Excluding items such as severance and discontinued operations, the company earned 71 cents per share, up from 62 cents a year earlier. Analysts targeted 67 cents, according to Thomson Reuters I/B/E/S.

AmerisourceBergen said in July it won a deal with Express Scripts Holding Co, which moved from rival Cardinal Health Inc after Express Scripts bought Medco Health Solutions. Medco already had a deal with AmerisourceBergen.

Analysts said at the time they expected the deal for bulk business to bring down AmerisourceBergen's operating margins. In addition to Cardinal Health, the company competes with McKesson Corp.

AmerisourceBergen said operating income in its pharmaceutical distribution business fell from a year earlier, hurt by a shift among customers to lower-margin business and disappointing performance in its Canadian business.

Overall operating income rose 2.1 percent, helped by its acquisition of World Courier, a provider of transportation, storage and distribution services for drug clinical trials.

Revenue was up 5.7 percent to $21.5 billion from $20.3 billion a year earlier. Pharmaceutical distribution revenue rose 5 percent to $21.1 billion. Other revenue came from World Courier and TheraCom, a biotech and pharmaceuticals services company it bought in 2011.

It reaffirmed its forecast for fiscal 2013 earnings of $3.06 to $3.16 per share. Analysts expect $3.13 per share, according to Thomson Reuters I/B/E/S.