Hospira Q3 Profit Up 58%, Results Beat View; Reaffirms 2013 Adj. Outlook

(RTTNews) - Pharmaceutical and medication delivery company Hospira, Inc. (HSP) on Wednesday reported a 58 percent increase in profit for the third quarter from last year, reflecting fewer charges and improved margins.

Both revenue and adjusted earnings per share beat analysts' estimates. Looking ahead, the company reiterated its fiscal 2013 outlook for adjusted earnings and revenue growth. Hospira's shares are gaining more than 7 percent in pre-market trades.

Michael Ball, chief executive officer of Hospira said, "We were especially pleased to receive European approval in the quarter of our biosimilar infliximab, Inflectra - the first monoclonal antibody biosimilar to be approved in Europe. We are also seeing continued demand for the new premix versions of our branded sedation agent, Precedex."

The Lake Forest, Illinois-based provider of injectable drugs and infusion technologies reported net income for the third quarter of $1.9 million, up from $1.2 million in the prior-year quarter.

However, earnings per share was flat with the year-ago period at $0.01 per share on higher weighted average common shares outstanding in the latest quarter.

The latest quarter's results include charges totaling $0.50 per share, while the year-ago results included charges totaling $0.46 per share.

Excluding these items, adjusted net income for the quarter was $84.5 million or $0.51 per share, compared to $78.4 million or $0.47 per share in the year-ago quarter. On average, 13 analysts polled by Thomson Reuters expected the company to report earnings of $0.45 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 1 percent to $1.01 billion from $994 million in the same quarter last year, and beat analysts' consensus revenue estimate of $993.22 million.

The company noted that continued strong global sales of Precedex and other Specialty Injectable Pharmaceuticals or SIP products in the U.S. more than offset the impact of pricing erosion of certain newer U.S. SIP products and lower device sales.

The lower device sales primarily resulted from the impact of the ship-hold of most of the company's infusion devices previously put in place due to prior actions of various regulatory authorities.

Total operating costs and expenses for the quarter declined 3 percent to $978.4 million, reflecting a decrease in cost of products sold.

Gross profit margin improved to 28.8 percent from last year's 21.6 percent.

Net sales of specialty injectable pharmaceuticals or SIP products, increased 27 percent from the year-ago period to $685 million, while medication management product sales declined 11 percent to $209.8 million, and other pharma sales edged down 0.7 percent to $113.4 million.

Total Americas sales rose 1.9 percent to $804.2 million, while total Europe, Middle East & Africa sales edged up 0.5 percent to $123.5 million, and total Asia Pacific sales decreased 1.8 percent to $80.5 million from last year.

Looking ahead to fiscal 2013, Hospira now forecasts reported loss in a range of $0.08 to $0.18 per share, compared to its prior outlook for earnings in a range of $0.01 to $0.11 per share.

However, Hospira reiterated its full-year outlook for adjusted earnings in a range of $2.00 to $2.10 per share, on projected adjusted net sales between a decline of 1 percent and growth of 1 percent on a constant-currency basis.

Street is currently looking for full-year earnings of $2.07 per share, on revenue decline of 0.40 percent to $4.08 billion.

HSP closed Tuesday's trading session at $40.00, down $0.21 on a volume of 1.08 million shares.