Emergent (EBS) Q2 Earnings and Revenues Surpass Estimates

Emergent Biosolutions, Inc . EBS delivered second-quarter 2018 earnings of $1.07 per share, surpassing the Zacks Consensus Estimate of 96 cents and the year-ago bottom-line figure of 13 cents.

Revenues in the reported quarter skyrocketed 117.8% from the year-earlier period's level to $220 million, primarily backed by high product sales, partially offset by lower contracts plus grants revenues. Moreover, the top line outpaced the Zacks Consensus Estimate of $209 million.

Shares of Emergent were up almost 3.25% on Aug 2 following its earnings release. The stock has outperformed the industry so far this year with a rally of 21.9% against the industry's decrease of 3.7%.

Quarter in Detail

Total product sales soared 183% to $180.1 million from the year-earlier quarter's tally, mainly owing to higher sales of Emergent's anthrax vaccine, BioThrax, and smallpox vaccine, ACAM2000.

BioThrax's sales surged 48% in the quarter under review to $77.6 million. Other product sales rose to $1.02.5 million from $11.3 million in the comparable quarter last year.

The increase in other product sales is almost entirely courtesy of the incremental contribution of ACAM2000, raxibacumab and Trobigard, which did not generate sales in the prior-year period.

Notably, raxibacumab and ACAM2000 were acquired by Emergent from GlaxoSmithkline GSK and Sanofi SNY respectively, during the fourth quarter of 2017.

Contracts, grants and collaboration revenues declined 21% year over year to $16.5 million, primarily due to reduction in the R&D activities, associated with certain development funding programs.

On the flip side, contract manufacturing revenues jumped 46% to $23.6 million compared with the year-ago figure. This upside was primarily on the completion of certain contract manufacturing services at the company's Canton site.

Research and development expenses were $24.7 million, down 4% from the level in the comparable quarter last year. This downside was due to lower costs associated with contract development services.

2018 Outlook

Emergent maintained its previously issued revenue guidance of $715-$755 million in 2018. The company continues to expect adjusted net income between $110 million and $125 million.

Third-Quarter 2018 Outlook

The company anticipates total revenues between $165 million and $190 million in the third quarter of 2018.

Other Updates

Late in July, Emergent initiated a phase I study for its pipeline candidate, ZIKV-IG, currently being developed as a therapeutic intervention against Zika virus disease.

In May, The Coalition for Epidemic Preparedness Innovations announced a collaboration with Profectus BioSciences, Inc. and Emergent BioSolutions Inc. whereby both Profectus and Emergent will receive up to $25 million, each, to advance the development and manufacturing of a vaccine against the Nipah virus.

In April, Emergent announced the successful completion of the Mutual Recognition Procedure for market authorization of its anthrax vaccine, BioThrax, across five Concerned Member States within the European Union including Italy, the Netherlands, Poland, the U.K. and France. BioThrax has received a market authorization across four of the five countries.

Emergent plans to make a $50-million investment over the next three years at the Camden fill/finish facility located in Baltimore. The expansion is likely to drive the company's key contract development and manufacturing organization business unit.

Emergent Biosolutions Inc. Price, Consensus and EPS Surprise

Emergent Biosolutions Inc. Price, Consensus and EPS Surprise | Emergent Biosolutions Inc. Quote

Zacks Rank & Another Stock to Consider

Emergent currently carries a Zacks Rank #2 (Buy). Another top-ranked stock in the health care sector is Eagle Pharmaceuticals, Inc. EGRX , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Eagle Pharmaceuticals' earnings estimates have been moved 15.1% north for 2018 and 26% for 2019 over the past 60 days. The stock has soared 45.4% year to date.

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Sanofi (SNY): Free Stock Analysis Report

GlaxoSmithKline plc (GSK): Free Stock Analysis Report

Eagle Pharmaceuticals, Inc. (EGRX): Free Stock Analysis Report

Emergent Biosolutions Inc. (EBS): Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story


Other Topics

Earnings Stocks

Latest Markets Videos


    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at

    Learn More