Forest Labs Q2 Results Beat Estimates, Lifts FY14 View

(RTTNews) - Drug maker Forest Laboratories, Inc. (FRX) Tuesday reported a sharp increase in second-quarter profit, as net sales climbed about 17 percent, driven by sales of its next generation products. Both earnings per share and revenues topped analysts' expectations. The company also raised its adjusted earnings per share outlook for fiscal 2014.

Brent Saunders, CEO and president stated, "To make Forest more relevant to all of our key stakeholders - customers & patients; owners; partners and colleagues - we are conducting a thorough review of our business operations and evaluating changes to our strategy."

For the second quarter, the company posted net income of $69.99 million or $0.26 per share, significantly up from $20.78 million or $0.08 per share in the previous year.

Excluding acquisition related amortization and specified items, adjusted earnings per share for the recent quarter were $0.36, while the company posted $0.15 per share in the same quarter of fiscal 2013.

On average, 22 analysts polled by Thomson Reuters expected earnings per share of $0.15 for the quarter. Analysts' estimates typically exclude one-time items.

Net revenues for the quarter climbed to $855.26 million from $760.64 million reported a year before, and came above analysts' estimate of $840.96 million.

The company said its net sales grew 17.3 percent to $811.43 million from $692.02 million in the prior-year quarter, helped by the sales of its next generation products. Sales from next generation products surged 49.9 percent to $303 million.

Namenda, for the treatment of moderate to severe Alzheimer's disease, recorded sales of $396.3 million, up 7.8 percent from last year. Namenda XR, launched in June 2013, recorded sales of $11.5 million during the quarter. Namenda franchise sales increased 11 percent compared to the year-ago quarter.

Tudorza, launched in December 2012, and indicated for long-term maintenance treatment of bronchospasm associated with COPD, recorded sales of $16.7 million during the quarter.

Linzess, for irritable bowel syndrome with constipation and chronic idiopathic constipation in adults, generated sales of $34.4 million. Linzess was also launched in December last year.

For the fiscal year ending March 31, 2014, the company now expects adjusted earnings per share to be in the range of $0.95 to $1.15, up from the prior outlook of $0.80 to $1.00 per share. Analysts project annual earnings of $0.96 per share.

FRX closed Monday's regular trading at $44.31 on the NYSE. In the pre-market activity on Tuesday, the shares are up 4.38 percent.