Hospira Boosts 2014 Outlook As Q2 Results Top Estimates

(RTTNews) - Pharmaceutical and medication delivery company Hospira, Inc. (HSP) reported Wednesday a profit for the second quarter that more than doubled from last year, reflecting lower charges and double-digit sales growth.

Both adjusted earnings per share and quarter sales topped analysts' expectations. The company also provided raised earnings and sales growth guidance for the full-year 2014, citing favorable performance in the first half of 2014.

"Hospira delivered another strong quarter, driven by continued positive performance in our Specialty Injectable Pharmaceuticals products. The investments we have been making to reinforce our foundation and drive growth are also contributing to our results, as are the diligent efforts of Hospira employees around the world," CEO Michael Ball said in a statement.

The Lake Forest, Illinois-based provider of injectable drugs and infusion technologies reported net income of $70.9 million or $0.42 per share for the second quarter, sharply higher than $32.9 million or $0.20 per share in the prior-year quarter.

Excluding the items, adjusted earnings for the quarter was $122.1 million or $0.72 per share, compared to $92.1 million or $0.55 per share in the year-ago quarter.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $0.57 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter increased 10.7 percent to $1.14 billion from $1.03 billion in the same quarter last year, and topped twelve Wall Street analysts' consensus estimate of $1.06 billion.

The company noted that sales growth was driven by continued positive performance in specialty injectable pharmaceuticals products amid favorable pricing and continued supply recovery in the U.S.

Segment-wise, specialty injectable pharmaceuticals sales grew 13.8 percent to $785.3 million, and medication management sales were $215.5 million, up 0.7 percent from last year. Other pharma sales grew 10.3 percent to $135.0 million from a year ago.

Region-wise, total Americas sales improved 11.9 percent to $913.2 million, and Europe, Middle East & Africa (EMEA) sales totaled $132.7 million, up 2.6 percent from last year. Asia Pacific (APAC) sales increased 11.4 percent to $89.9 million from a year ago.

Operating margin for the quarter expanded 370 basis points to 8.8 percent from last year, as gross profit (net sales less cost of products sold), as a percentage of total sales, improved 410 basis points.

"Given our favorable performance for the first half of 2014, we are raising our guidance for the full year, with a continued focus on serving our customers, driving profitable growth and delivering shareholder value," Ball added.

Looking ahead to fiscal 2014, the company raised adjusted earnings guidance to a range of $2.30 to $2.50 per share from the prior forecast range of $2.00 - $2.25 per share. The company now projects net sales growth of 6 to 9 percent, up from the previous projection between a decline of 2 percent and a growth of 3 percent, on a constant-currency basis, from 2013.

Street is currently looking for full-year 2014 earnings of $2.22 per share on annual net sales of $4.19 billion.

HSP closed Tuesday's regular trading session at $51.90, up $0.06 on a volume of 2.01 million shares.