Perrigo Q3 Profit Declines - Update

(RTTNews) - Perrigo Co. (PRGO) Tuesday reported a steeper-than-expected decline in third-quarter profit, as the generic drug maker incurred higher tax expense, offsetting growth in sales that gained from base business performance, new product demand as well as acquisitions. However, the company's sales fell short of expectations, sending its shares down 4 percent in morning trade on the Nasdaq.

Allegan, Michigan-based Perrigo posted quarterly net income of $112 million or $1.18 per share, compared with $115.7 million or $1.23 per share last year.

Excluding items, adjusted earnings for the quarter were $134 million or $1.42 per share.

On average, 16 analysts polled by Thomson Reuters expected earnings of $1.44 per share for the quarter. Analysts' estimates typically exclude one-time items.

Net sales for the quarter jumped 18 percent to $920 million from $778 million in the prior year. Analysts expected sales of $935.44 million for the quarter.

Among segments, Consumer Healthcare gained 19.6 percent, Nutritionals were up 13.3 percent, and Rx Pharmaceuticals jumped 21.7 percent. Sales at API segment was up 11.3 percent.

Income tax expense for the quarter was higher at $48 million, compared with $19 million a year ago, when the company recorded a tax benefit.

For fiscal year 2013, Perrigo continues to expect net earnings of $4.67 to $4.87 per share and adjusted earnings of $5.53 to $5.73 per share. Analysts currently expect earnings of $5.64 per share for the year.

Last month, Perrigo closed its acquisition of Velcera Inc. for about $160 million. Yardley, Pennsylvania-based Velcera makes pet health products. In February, Perrigo acquired UK-based Rosemont Pharmaceuticals Ltd. for about 180 million pounds or $283 million.

The company's stock is trading at $114.25, down $4.58 or 3.86%, on a volume of 0.8 million shares.