Raises FY 2007 EPS Guidance Range to $2.79-$2.84 NEW YORK, Jan. 16
/PRNewswire-FirstCall/ -- Forest Laboratories, Inc. (NYSE:FRX), a
U.S.-based pharmaceutical company, today announced that fully
diluted earnings per share equaled $0.78 in the third quarter of
fiscal 2007, an increase of 37% over last year's third quarter's
fully diluted earnings per share of $0.57. Reported earnings
included a $10,200,000 million charge for stock option expense in
accordance with the adoption of Statement of Financial Accounting
Standard 123R as well as a $20,000,000 product development
milestone payment. (Logo:
http://www.newscom.com/cgi-bin/prnh/20001011/FORESTLOGO ) Revenues
for the quarter increased 18% to $893,031,000 from $757,830,000 in
the year-ago period. Revenues were comprised of net sales of
$830,431,000, an increase of 16% from $714,887,000 in the year-ago
period, earnings contribution of $38,664,000 from the co-promotion
of Benicar(R)* (olmesartan medoxomil) and Benicar HCT(R),
antihypertensive therapies, which increased 37% from $28,290,000 in
the year-ago quarter, interest income of $22,577,000 which
increased 59% from $14,229,000 in the year-ago period and other
contract and miscellaneous income of $1,359,000. Sales in the
quarter included $554,964,000 for Forest's antidepressant franchise
which was comprised of $545,855,000 of Lexapro(R) (escitalopram
oxalate), an SSRI indicated for the initial and maintenance
treatment of major depressive disorder and generalized anxiety
disorder in adults, $7,928,000 of Celexa(R) (citalopram HBr), an
antidepressant, and $1,181,000 of generic citalopram. The year-ago
period included $485,687,000 of antidepressant franchise sales
which was comprised of $480,707,000 of Lexapro, $4,823,000 of
branded Celexa and $157,000 of generic citalopram. Sales of
Namenda(R), an NMDA receptor antagonist for the treatment of
moderate and severe Alzheimer's disease, totaled $173,881,000 in
the quarter compared to sales of $124,022,000 in last year's third
quarter. Selling, general and administrative expenses increased 7%
to $268,626,000. Research and development spending increased 19% to
$112,029,000 during the quarter and included a one-time product
development milestone payment of $20,000,000. Net income in the
current quarter increased by 28% to $250,301,000 as compared to
$195,163,000 reported in the third quarter of the prior year. Fully
diluted shares outstanding for the third quarter were 320,363,000,
a reduction of 20,300,000 shares due mainly to the Company's share
repurchase program. During the quarter the Company purchased
1,290,000 shares under its current 25 million share authorization
and has an additional 14,684,700 shares available for repurchase
under the program, which has no expiration date. Nine-month results
Revenue for the nine months ended December 31, 2006 increased 16%
to $2,556,344,000 from $2,206,068,000 in the prior year. Net income
for the nine months ended December 31, 2006 increased 12% to
$692,019,000 from net income of $616,624,000 reported in the nine
months of the prior year. Diluted earnings per share increased 20%
to $2.14 in the current year's first nine months as compared to
diluted earnings per share of $1.79 for last year's nine months.
Fiscal 2007 Guidance Based on the stronger-than-projected
performance of our promoted products, the Company has increased its
expectations for fully diluted earning per share for the fiscal
year ending March 31, 2007 to $2.79-$2.84 from prior guidance of
$2.60-$2.65 per share. The revised guidance excludes the impact of
the one-time in-process research and development charge related to
the acquisition of Cerexa, Inc. of approximately $494 million, or
approximately $1.54 per share. This charge will be recorded in the
fiscal fourth quarter and is subject to final purchase price
valuation and allocation. The revised estimate of per share effect
of the charge recognizes that there is no deferred tax benefit to
be reflected. In addition, the revised earnings per share guidance
does include planned research and development expenses associated
with Cerexa related product development programs. Howard Solomon,
Chairman and Chief Executive Officer of Forest, said: "We are
encouraged by both the performance of our key marketed products and
by the opportunities we currently have in our development pipeline
as well as the prospect to add future development programs. During
the quarter we announced the acquisition of Cerexa, Inc. Our
acquisition of Cerexa provides us with major opportunities in an
entirely new therapeutic area, the hospital injectable
anti-infective market, which urgently needs innovative drugs
because of the persistent and inevitable development of increased
resistance to existing antibiotics. We believe Cerexa is an
outstanding company, with extraordinary leadership and scientists
that we expect will become a major source of growth for Forest.
Cerexa's most advanced product, ceftaroline, will shortly be
commencing Phase III studies. "We remain strategically focused on
both supporting continued growth of our in-line products, which
generate predictable and significant free cash flow, as well as
identifying promising development opportunities." Forest will host
a conference call at 10:00 AM EST today to discuss the results. The
conference call will be webcast live beginning at 10:00 AM EST on
the Company's website at http://www.frx.com/ and also on the
website http://www.streetevents.com/. Please log on to either
website at least fifteen minutes prior to the conference call as it
may be necessary to download software to access the call. A replay
of the conference call will be available until January 31, 2007 at
both websites and also by dialing 1-800-642-1687 (US investors) or
+1-706-645-9291 (international investors) passcode 5744720. About
Forest Laboratories and Its Products Forest Laboratories
(http://www.frx.com/) is a U.S.-based pharmaceutical company
dedicated to identifying, developing, and delivering products that
make a positive difference in peoples' lives. Forest Laboratories'
growing product line includes Lexapro(R) (escitalopram oxalate), an
SSRI indicated for adults for the initial and maintenance treatment
of major depressive disorder and for generalized anxiety disorder;
Namenda(R) (memantine HCl), an N-methyl-D-aspartate (NMDA)-receptor
antagonist indicated for the treatment of moderate and severe
Alzheimer's disease; Benicar(R)* (olmesartan medoxomil), an
angiotensin receptor blocker, and Benicar* HCT(R) (olmesartan
medoxomil-hydrochlorothiazide), an angiotensin receptor blocker and
diuretic combination product, each indicated for the treatment of
hypertension; and Campral(R)* (acamprosate calcium), indicated in
combination with psychosocial support for the maintenance of
abstinence from alcohol in patients with alcohol dependence who are
abstinent at treatment initiation. * Benicar is a registered
trademark of Daiichi Sankyo, and Campral is a registered trademark
of Merck Sante s.a.s., subsidiary of Merck KGaA, Darmstadt,
Germany. Except for the historical information contained herein,
this release contains "forward-looking statements" within the
meaning of the Private Securities Reform Act of 1995. These
statements involve a number of risks and uncertainties, including
the difficulty of predicting FDA approvals, acceptance and demand
for new pharmaceutical products, the impact of competitive products
and pricing, the timely development and launch of new products and
the risk factors listed from time to time in the Company's SEC
reports, including the Company's Annual Report on Form 10-K for the
fiscal year ended March 31, 2006 and on Form 10-Q for the period
ended June 30, 2006. FOREST LABORATORIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) THREE MONTHS NINE
MONTHS ENDED DECEMBER 31 ENDED DECEMBER 31 (In thousands, except
per share amounts) 2006 2005 2006 2005 Revenues: Net sales $830,431
$714,887 $2,367,875 $2,081,173 Contract revenue 38,914 28,373
130,485 86,945 Interest Income 22,577 14,229 56,330 38,241 Other
income 1,109 341 1,654 (291) Net revenues 893,031 757,830 2,556,344
2,206,068 Costs and expenses: Cost of goods sold 195,539 165,875
556,322 483,136 Selling, general and administrative 268,626 250,725
772,017 772,435 Research and development 112,029 94,188 344,863
216,054 576,194 510,788 1,673,202 1,471,625 Income before income
tax expense 316,837 247,042 883,142 734,443 Income tax expense
66,536 51,879 191,123 117,819 Net income $250,301 $195,163 $692,019
$616,624 Net income per share: Basic $0.79 $0.58 $2.17 $1.81
Diluted $0.78 $0.57 $2.14 $1.79 Weighted average number of shares
outstanding: Basic 316,200 336,890 318,512 340,160 Diluted 320,363
340,663 323,048 344,801
http://www.newscom.com/cgi-bin/prnh/20001011/FORESTLOGO
http://photoarchive.ap.org/ DATASOURCE: Forest Laboratories, Inc.
CONTACT: Charles E. Triano, Vice President - Investor Relations, of
Forest Laboratories, Inc., +1-212-224-6714, Web site:
http://www.frx.com/ http://www.streetevents.com/
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