DOW JONES NEWSWIRES
Gilead Sciences Inc.'s (GILD) first-quarter profit slid 24% as
income from royalties declined sharply and operating margin
narrowed.
Shares fell 2.9% to $39.60 in after-hours trading as the results
missed Wall Street's estimates. The stock had gained 13% this year
through Wednesday's close.
The biopharmaceutical company has dominated the market for HIV
treatment and receives royalties from Roche Holding AG (RHHBY,
ROG.VX) for Tamiflu, which Gilead discovered.
Gilead posted a profit of $651.1 million, or 80 cents a share,
down from $854.9 million, or 92 cents a share, a year earlier.
Excluding acquisition-related expenses, restructuring and
stock-based compensation, earnings slipped to 87 cents from 99
cents. Revenue dropped 7.7% to $1.93 billion, which included a $3.3
million hit from foreign-currency impacts.
Analysts surveyed by Thomson Reuters had predicted earnings of
97 cents a share on revenue of $2.03 billion.
Operating margin narrowed to 46.8% from 55.7%.
Product sales, from which the company gets the majority of its
revenue, rose 3.9%. Sales of antiviral products increased 1.9% as
sales of HIV treatments Atripla and Truvada climbed 7.4% and 2.3%,
respectively. Royalties from Tamiflu fell 95% to $11.1 million as
pandemic planning initiatives declined worldwide.
-By Ian Thomson, Dow Jones Newswires; 212-416-2314;
ian.thomson@dowjones.com