Shire upgrades earnings forecast after second-quarter beat
LONDON (Reuters) - British drugmaker Shire (SHP.L) raised its full-year earnings outlook after it beat expectations with a 6 percent rise in second-quarter earnings, despite generic competition to its ageing Adderall XR drug for hyperactivity.
New chief executive Flemming Ornskov said on Thursday that the company had returned to higher growth, helped by a strong performance from its Lialda treatment for ulcerative colitis and its newer hyperactivity drugs Vyvanse and Intuniv.
Shares in the company jumped to the top of the FSTE 100 .FTSE leaderboard after the guidance upgrade. They were trading up 4.1 percent at 2,308 pence by 1206 GMT.
Shire posted non-GAAP earnings per American Depositary Share (ADS) of $1.79, compared to the $1.66 forecast by analysts in a company-supplied poll. Revenue of $1,275 million was up 6 percent, beating the $1,221 million the market expected.
Ornskov said the company now expected to deliver full-year double-digit non-GAAP earnings growth in 2013, and it was confident in its ability to grow operating margins going forward.
Previously the group has said it would meet analyst consensus for earnings, which would represent growth just short of 10 percent.
As well as treatments for hyperactivity, London-listed Shire also focuses on drugs for treating rare diseases.
Ornskov, who took over in May, is reorganising Shire into five divisions - rare diseases, neuroscience, gastrointestinal, regenerative medicine and internal medicine - and scaling back early-stage research.
Analysts expect continuing pressure from generic versions of Shire's top-selling hyperactivity drug Adderall XR to crimp growth for the next couple of years. Dermagraft, a treatment for diabetes-related ulcers, has also been disappointing to date.
But further out there are hopes for new products coming through the pipeline - notably Lifitegrast for dry eye - and Shire is expected to continue its strategy of making bolt-on acquisitions in key therapeutic areas.
(Reporting by Ben Hirschler and Paul Sandle; editing by Kate Holton and Stephen Nisbet)
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