April 29, 2010 / 11:32 AM / 9 years ago

UPDATE 4-Mylan sticks to full-year forecast, shares fall

* Q1 EPS ex-items 36 cents vs 34-cent Wall St estimate

* Backs 2010 forecast

* Shares down 4 percent (Adds company comment from conference call, updates shares)

By Bill Berkrot

NEW YORK, April 29 (Reuters) - Mylan Inc (MYL.O) posted a better-than-expected first-quarter profit on Thursday, helped by strong overseas sales, but the generic drugmaker maintained its full-year forecast and its shares fell 4 percent.

Excluding items, Mylan earned 36 cents per share, topping the consensus estimate of analysts by 2 cents, according to Thomson Reuters I/B/E/S.

Pittsburgh-based Mylan said it continues to project 2010 earnings in a range of $1.50 to $1.70 per share.

“Whenever a company beats earnings and doesn’t raise the outlook, it’s concerning,” said CLSA analyst David Maris.

“If you earn a few cents extra this quarter, you should be able to carry it through for the rest of the year,” Maris said.

The company said it expects the majority of its 2010 earnings growth and gross margin improvement to come in the second half of the year.

Mylan declined to quantify the cost to the company of new U.S. healthcare reform laws, but Chief Executive Robert Coury told analysts on a conference call that he would not classify it as material.

“We feel very comfortable we can fully absorb the impact of healthcare reform in our guidance,” Coury said, adding that Mylan stands to benefit in 2014 and beyond, when millions of currently uninsured people gain health insurance.

Net income at the world’s third-largest generic drugmaker fell to $61.1 million, or 20 cents per share, from $71.3 million, or 23 cents per share, a year earlier.

Revenue rose 7 percent to $1.29 billion, matching Wall Street estimates.

The company said it still expects full-year revenue of $5.45 billion to $5.75 billion.

In the region including Europe, the Middle East and Africa, revenue rose nearly 15 percent to $410.8 million, helped by performance in Italy, France and Spain. Sales in the Asia Pacific region jumped nearly 31 percent to $282.3 million.

The overseas performance countered a decline in North American revenues of 5 percent to $562.7 million.

Mylan’s specialty drugs unit saw revenue jump 21 percent to $101 million.

Research and development spending and selling and general and administrative costs rose. Mylan attributed that to the impact of foreign exchange rates and higher payroll expenses.

Mylan shares were down 86 cents, or 3.96 percent, at $20.85 in late morning trade on the Nasdaq stock market. (Reporting by Bill Berkrot and Lewis Krauskopf; Editing by Robert MacMillan and Gunna Dickson)

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