Hospira Q4 Profit Rises, Results Top Estimates; Sees 2014 Adj. EPS In Line

(RTTNews) - Pharmaceutical and medication delivery company Hospira Inc. (HSP) reported that its fourth-quarter of 2013 net income significantly increased to $33.5 million or $0.20 per share, from $5.3 million or $0.03 per share in the same quarter last year.

Adjusted income from operations increased 6.0 percent to $129 million in the fourth quarter of 2013, compared to $122 million in the fourth quarter of 2012. The increase primarily related to the impact of supply recovery and improved pricing in the company's SIP products, which more than offset the year-over-year increase in selling, general and administration or SG&A expense.

On a GAAP basis, income from operations was $53 million compared to $31 million in the fourth quarter of 2012. The year-over-year change in fourth quarter GAAP income from operations was primarily attributed to restructuring charges in 2012.

Adjusted net income for the quarter dropped to $84.9 million from the prior year's $91.4 million, with adjusted earnings per share declining to $0.51 from $0.55 last year. Analysts polled by Thomson Reuters expected the company to report earnings of $0.50 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales decreased 1.3 percent to $1.08 billion from $1.10 billion in the year ago quarter. Nine. analysts estimated revenues of $1.06 billion for the quarter. The majority of the decrease was due to the impact of the ship-hold in place on most of the company's infusion devices, the expected year-over-year decline of U.S. sales of the oncolytic docetaxel and the negative impact of foreign currency. Partially offsetting the decrease was strong global Specialty Injectable Pharmaceuticals or SIP growth, which benefited from supply recovery and improved pricing in the United States.

Looking ahead for 2014, the company expects the change to net sales for full-year 2014 to range between negative 2 and positive 3 percent on a constant-currency basis, with a flat to negative 1 percent impact from foreign currency. GAAP earnings per share for 2014 are expected to be in the range of $0.91 - $1.16. Adjusted earnings per share for 2014 are expected to be in a range of $2.00 to $2.25. Street currently is looking for fiscal year 2014 earnings of $2.15 per share on annual revenues of $4.16 billion.

The projection ranges for full-year 2014 net sales and adjusted earnings per share include, among several factors, assumptions related to the timing of genericization of Precedex (dexmedetomidine HCl), the company's proprietary pharmaceutical for sedation.

The company projects that cash flow from operations in 2014 will range between $100 million and $200 million. Capital expenditures are projected to range between $375 million to $425 million. Depreciation and amortization is expected to range between $225 million to $275 million.