* Q2 EPS, excluding items, $1.07, vs $1.06 forecast
* Q2 sales rise 4.8 pct to $1.47 bln vs. $1.50 bln forecast
* Lifts low end of 2012 forecast, despite stronger dollar
* Shares rise 6.2 percent
By Ransdell Pierson
Aug 1 Allergan Inc reported slightly
higher-than-expected quarterly earnings, rebounding from
disappointing results in the prior quarter, as sales of its
Botox anti-wrinkle treatment, skin care products and breast
The specialty drugmaker, which tends to provide conservative
sales and profit forecasts and then outperform, jolted some
investors and industry analysts in May with a narrow earnings
miss and a disappointing outlook for the second quarter.
But shares of Allergan rose 6.2 percent to $87.19 on
Wednesday as the company posted strong second-quarter results
and lifted the lower end of its 2012 profit view, despite a
strong dollar that bit hard into its overseas sales. Even so, it
provided a cautious third-quarter earnings forecast.
"Allergan reported solid second quarter results given the
continued difficult currency environment," Cowen and Co analyst
Ken Cacciatore said in a research note, saying the Botox trends
appear "exceedingly strong."
Allergan predicted Botox sales of up to $1.8 billion this
year, representing almost one third of projected total company
Company shares trade at almost 20 times Allergan's expected
2012 per share earnings, a hefty premium to most drugmakers and
medical device makers. But Cacciatore said the lofty valuation
is warranted because of Allergan's consistent cash flows and an
underrated pipeline of experimental products "that could be
massively value creating."
One is a hair loss treatment that uses the active ingredient
of Latisse -- a company product used to extend length of
eyelashes. Another, also in mid-stage trials, is being tested to
treat macular degeneration, a leading cause of blindness.
The specialty drugmaker said second-quarter net earnings had
risen to $296 million, or 96 cents per share, from $249 million,
or 79 cents per share, a year earlier.
Excluding special items, the company earned $1.07 per share.
Analysts on average expected $1.06, according to Thomson Reuters
Revenue rose 4.8 percent to $1.47 billion, compared with the
analysts' forecast of $1.50 billion. Sales would have risen 8.7
percent if not for negative foreign exchange factors.
Sales of Botox, which is also used to treat migraine
headaches and other conditions, rose 10.2 percent to $461
million in the second quarter. Skin care products rose 9.3
percent to $71 million, while breast implant sales increased 6
percent to $101 million. But sales of the Lap-Band device to
treat obesity fell 24 percent to $41 million, making it the
company's clear product laggard.
Allergan said it expected third quarter-earnings, excluding
special items, of $1.02 to $1.04 per share -- versus Wall Street
estimates of $1.06.
The company said it is aiming for full-year earnings of
$4.15 to $4.19 per share, compared with its earlier view of
$4.13 to $4.19. That would reflect growth of as much as 15
percent from 2011 earnings.