Valeant Posts a Loss, Says It Will Retool
09 Août 2016 - 1:20PM
Dow Jones News
Valeant Pharmaceuticals International Inc. posted a wider loss
in its latest quarter, and the company said it would reorganize,
continuing a push to remake itself as a normal pharmaceutical
firm.
The company also affirmed its yearly guidance after a string of
cuts, easing fears of triggering a debt-covenant breach. Shares in
the company added 7% premarket to $24.
It has been just over a full year since Valeant shares hit an
all-time closing high. Since that peak last August at $262.52, the
stock has erased more than 90% of its value amid a slate of
concerns, including drug-price hikes, accounting problems, a brush
with a potential debt default, and investigations by Congress and
federal regulators.
Investors have been watching for signs of what kind of
profitability Valeant can deliver as it distances itself from big
acquisitions and severe price increases for its drugs, the method
it used to build its business.
Chief Executive Joseph Papa, who took the helm from Michael
Pearson in May, said the company would be going in a "new strategic
direction" that involves reorganizing the company and its reporting
segments. The company didn't further outline the plan Tuesday
morning. Mr. Papa said the new direction for Valeant "has a mission
to improve patients' lives."
For the quarter ended in June, Valeant posted a loss of $302.3
million, or 88 cents a share, wider than its loss of $53 million,
or 15 cents a share, a year earlier.
On an adjusted basis that strips out some costs and uses a new
tax-reporting method, earnings fell to $1.40 a share from $2.14.
Revenue slid 11% to $2.42 billion. Analysts were looking for
adjusted earnings of $1.48 a share on $2.46 billion in revenue,
according to Thomson Reuters.
Valeant backed its guidance for the year—which it had cut
sharply at the end of the previous quarter—for earnings of $6.60 to
$7 a share and revenue between $9.9 billion and $10.1 billion. By
backing its guidance, Valeant essentially endorsed that it thinks
it can earn enough to keep its ratios high enough to stay in
compliance with its debt covenants.
Valeant also said it agreed to sell all North American
commercialization rights to Ruconest to Pharming Group NV for $60
million upfront and additional sales-based milestone payments of up
to $65 million.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
August 09, 2016 07:05 ET (11:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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