) reported fourth quarter 2012 earnings of $1.15 per share,
missing the Zacks Consensus Estimate of $1.19 per share.
While earnings increased 15.0% from the year-ago quarter,
revenues increased 7.6% to $1,508.9 million, slightly above the
Zacks Consensus Estimate of $1,504 million.
Full year earnings increased 13.4% to $4.14 per share, missing
the Zacks Consensus Estimate of $4.18. Full year revenues
increased 7.1% to $5,806.1 million, slightly above the Zacks
Consensus Estimate of $5,796 million.
The Quarter in Detail
Specialty pharmaceuticals sales increased 8.2% to $1,254.0
million, with eye care pharmaceutical, Botox and skin care sales
Eye care pharmaceutical sales increased 7.1% to $706.1 million
with products like Restasis (up 8.1%), Alphagan franchise (up
7.5%) and the Lumigan franchise (up 6.5%) contributing to
Allergan expects Lumigan franchise sales to increase to $630
million - $660 million in 2013 from $622.6 million in 2012.
Meanwhile, Alphagan franchise sales are expected in the range of
$440 - $470 million in 2013 compared to $453.2 million in
Restasis sales are expected to increase to $830 million - $870
million in 2013 from $792 million in 2012. Allergan expects
Latisse sales to increase to $110 million in 2013, up about
Botox sales increased 14.3% year over year to $474.6 million.
Recent approvals for indications like chronic migraine and
urinary continence in adults with neurological conditions helped
Allergan expects 2013 Botox sales in the range of $1,900
million - $2,000 million, up from $1,766.3 million in 2012.
Meanwhile, Allergan's medical devices segment posted sales of
$230.6 million, up 2.9%. While breast aesthetics sales increased
5.8% to $91.4 million, facial aesthetics sales increased 12.7% to
$102.4 million. The obesity intervention segment continued to
disappoint, with sales declining 21.5% to $36.8 million.
Allergan is looking to sell the obesity intervention segment
and expects to do the same in the first half of 2013.
Selling, general and administrative (SG&A) expenses
increased 4.7% during the quarter to $564.8 million. Research and
development (R&D) expenses amounted to $239.3 million, up
2013 Earnings Guidance Tops Expectations
Allergan expects 2013 earnings of $4.75 - $4.83 per share -
this excludes the impact of the R&D tax credit signed into
law earlier this year and the dilutive impact of the company's
upcoming acquisition of
). The company expects product net sales to range from $5,900 -
$6,200 million in 2013, up from 2012 product net sales of
$5,549.3 million (excluding obesity segment sales).
The estimated impact of the R&D tax credit on net earnings
for 2012, which will be recognized in the first quarter of 2013,
is about 6 cents per share.
Earnings guidance was above expectations with the Zacks
Consensus Estimate currently standing at $4.74 per share.
For 2013, Allergan expects total specialty pharmaceuticals net
sales of $5,100 million - $5,340 million, up from 2012 total
specialty pharmaceuticals net sales of $4,784.6 million.
The company expects medical devices net sales of $800 million
- $860 million. Here, performance will be driven mainly by facial
aesthetics. Facial aesthetics sales are expected in the range of
$410 million - $440 million, up from $387.6 million in 2013.
Breast aesthetics sales are expected in the range of $390
million - $420 million, up from $377.1 million in 2012. The
obesity intervention unit will be treated as discontinued
operations from the first quarter of 2013.
For 2013, Allergan expects cost of sales to product net sales
ratio of about 13.5%, SG&A expenses to product net sales
ratio of 37% - 38% and R&D expenses to product net sales
ratio of 16.5%.
Allergan expects first quarter earnings in the range of 94 -
96 cents per share on product net sales of $1,375 million -
$1,450 million. The Zacks Consensus Estimate currently stands at
$1.03 per share, well below the company's guidance range.
However, we note that Allergan's guidance does not include the
impact of the R&D tax credit which will be recognized in the
Allergan currently carries a Zacks Rank #3 (Hold). While we
believe Allergan's presence across different segments will help
maintain growth going forward, companies like
) currently look better-positioned. Novo Nordisk is a Zacks Rank
#1 (Strong Buy) stock and Sanofi is a Zacks Rank #2 (Buy)
ALLERGAN INC (AGN): Free Stock Analysis
MAP PHARMACEUT (MAPP): Free Stock Analysis
NOVO-NORDISK AS (NVO): Free Stock Analysis
SANOFI-AVENTIS (SNY): Free Stock Analysis
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