MRK Merck and Co Inc

By Allison Prang 

Merck & Co. Inc. raised its expectations for revenue and adjusted earnings for the year as sales and earnings at the pharmaceutical company rose in the second quarter.

Merck's profit was $2.67 billion, up 56% from the comparable quarter a year prior, as sales climbed and restructuring costs fell.

Adjusted earnings were $1.30 a share. Analysts polled by FactSet were expecting adjusted earnings of $1.16 a share.

Sales rose 12% to $11.76 billion. Analysts were expecting $10.96 billion. The company said sales of cancer treatment Keytruda rose 58%.

The company has been trying to find deals to grow its cancer-treatment offerings. It announced in May it was buying Peloton Therapeutics Inc. and in June said it agreed to buy Tilos Therapeutics Inc., which works partly on cancer treatment.

The company said it now expects revenue to be between $45.2 billion and $46.2 billion for the fiscal year. In April, it said it was expecting between $43.9 billion and $45.1 billion. Analysts are expecting $44.71 billion.

The company said it expects to book a $1.1 billion charge related to its Peloton acquisition. As a result, Merck is now expecting earnings per share in the range of $3.78 to $3.88. It had previously guided for earnings per share of $4.02 and $4.14.

However, it raised its outlook for adjusted earnings. Merck is now expecting adjusted earnings per share to be between $4.84 and $4.94. It had been expecting between $4.67 a share and $4.79 a share. Analysts are expecting $4.75 a share.

Shares rose 2.1% Tuesday morning.

The company also said Tuesday it expects operating expenses for the fiscal year to increase by a low-single-digit rate compared with the prior year. It had previously said it was expecting those to fall year over year by a mid-single-digit rate.

In the second quarter, the company's research-and-development expenses declined and its restructuring costs fell 74% to $59 million. The company also reported $140 million in net other expense, which it said was because of lower income from investments in equity securities and impairment charges.

Write to Allison Prang at allison.prang@wsj.com

(END) Dow Jones Newswires

July 30, 2019 10:13 ET (14:13 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.