UPDATE: Teva Sees Sales, Profit Up In 2012; Authorizes $3 Billion Stock Buyback
December 21 2011 - 12:05PM
Dow Jones News
Teva Pharmaceutical Industries Ltd. (TEVA, TEVA.TV) predicted
its earnings and sales would rise in 2012, aided by the
introduction of new generic drugs that could help its U.S. business
recover from recent weakness.
The Israel generic-drug company, which has diversified into
brand-name and over-the-counter drugs, also said its board
authorized the repurchase of up to $3 billion of its ordinary
shares or American depositary shares over an expected three-year
period. The buyback would represent about 8% of Teva's shares
outstanding.
Teva shares declined 86 cents, or 2%, to $41.48 in recent
trading, as its 2012 earnings forecast range left room for the
company to miss current Wall Street expectations. The company also
called its prior 2015 sales and earnings targets "aspirational,"
suggesting it may not hit them.
Teva's large U.S. generics business has suffered this year
because it didn't have as many big product launches as in 2010. But
Teva Chief Executive Shlomo Yanai said on a conference call with
analysts that the business should improve in 2012.
"We see 2012 as a pivotal year where we anticipate an
unprecedented number of patent expirations and product launches,
and while many of those product launches come with robust
competition, we will compete effectively and increase our share in
that market," Yanai said.
Yanai said the new stock buyback program reflects the company's
confidence in its outlook and its long-term value. He added that he
doesn't envision any major acquisitions in 2012.
Canaccord Genuity analyst Randall Stanicky called Teva's 2012
outlook "conservative," saying the company could deliver upside
results if sales of multiple-sclerosis drug Copaxone come in higher
than expected, or if the company achieves greater savings from
recent acquisitions.
Stanicky said the stock buyback represents a greater commitment
to shareholder returns for Teva. "This is the first time we've
gotten a sizeable, multi-year commitment to buying back the stock,"
he said.
Moody's Investors Service said Teva's stock buyback could limit
the company's financial flexibility for other uses of cash, but
Moody's debt rating outlook is stable.
Teva and other generic-drug makers are capitalizing on a wave of
patent expirations for top-selling drugs. Eli Lilly & Co.'s
(LLY) Zyprexa antipsychotic and Pfizer Inc.'s (PFE) Lipitor
cholesterol-lowering drug recently lost U.S. market exclusivity,
and next year will bring the loss of patent protection for Merck
& Co.'s (MRK) Singulair allergy and asthma drug.
Teva expects one of its biggest generic-drug launches in 2012 to
be a copycat version of Forest Laboratories Inc.'s (FRX) Lexapro
antidepressant.
Teva said it expected to earn $5.48 to $5.68 a share in 2012,
excluding certain items such as legal settlements. In comparison,
the mean estimate of analysts surveyed by Thomson Reuters is $5.67
a share for 2012, up from a mean estimate of $4.95 for 2011.
Teva expects revenue of $22 billion for 2012, in line with the
Thomson estimate and up from a projected $18.3 billion for
2011.
Teva predicted generic-product sales of $11.8 billion, including
U.S. generic sales of about $5 billion. Teva said about $650
million of the sales would come from new-product launches.
The company sees branded-drug sales of about $8.2 billion,
including an estimated $3.8 billion for multiple sclerosis drug
Copaxone, $550 million for leukemia drug Treanda, and
women's-health-product sales of $525 million.
Teva said Copaxone sales will likely peak in 2012, as it faces
new competition from orally administered MS drugs.
Teva recently bolstered its brand-name drug portfolio with the
$6.8 billion acquisition of Cephalon Inc.
In addition, Teva expanded into OTC drugs with a new joint
venture with Procter & Gamble Co. (PG). Teva sees 2012 OTC
sales of $1 billion.
-By Peter Loftus, Dow Jones Newswires; +1-215-982-5581;
peter.loftus@dowjones.com
Forest Road Acquisition (NYSE:FRX)
Historical Stock Chart
From Jun 2024 to Jul 2024
Forest Road Acquisition (NYSE:FRX)
Historical Stock Chart
From Jul 2023 to Jul 2024