Biopharmaceutical company Merck & Co., Inc. (MRK) reported a profit for the second quarter that increased 12 percent from last year on lower expenses. Both adjusted earnings per share and quarterly revenues topped analysts’ expectations. Looking ahead, the company raised its earnings and revenue outlook for full-year 2020.
In Friday’s pre-market trade, MRK is trading at $81.25, up $2.18 or 2.76 percent.
Net income attributable to the company for the quarter increased to $3.0 billion or $1.18 per share from $2.67 billion or $1.03 per share in the prior-year quarter.
Excluding items, adjusted earnings for the quarter was $1.37 per share, compared to $1.30 per share in the year-ago quarter. On average, analysts polled by Thomson Reuters expected the company to report earnings of $1.04 per share for the quarter. Analysts’ estimates typically exclude special items.
Worldwide sales for the quarter declined 8 percent to $10.87 billion from $11.76 billion in the same quarter last year, reflecting the negative impact of COVID-19. The Street was looking for revenues of $10.39 billion for the quarter. Excluding the impact from foreign exchange, sales decreased 5 percent.
The estimated overall negative impact of the COVID-19 pandemic to Merck’s revenue was approximately $1.6 billion, consisting of approximately $1.5 billion for pharmaceuticals and approximately $100 million for Animal Health.
Pharmaceutical sales decreased 7 percent to $9.7 billion, and excluding the unfavorable effect from foreign exchange, sales grew 6 percent.
Growth in oncology partially offset the decline in pharmaceutical revenue, largely driven by higher sales of KEYTRUDA, which grew 29 percent to $3.4 billion for the quarter.
Animal Health sales were $1.1 billion for the second quarter of 2020, a decrease of 2 percent from last year and excluding the unfavorable effect from foreign exchange, Animal Health sales grew 3 percent.
Looking ahead to fiscal 2020, Merck now projects earnings in a range of $4.58 to $4.73 per share and adjusted earnings in a range of $5.63 to $5.78 per share on revenues between $47.2 billion and $48.7 billion, including a negative impact from foreign exchange of approximately 2 percent.
Previously, the company expected earnings in the range of $4.12 to $4.32 per share and adjusted earnings in the range of $5.17 to $5.37 per share on revenues between $46.1 billion and $48.1 billion.
Analysts expect annual earnings of $5.31 per share on revenues of $47.33 billion for the year.
Merck said it now expects an unfavorable impact to revenue of approximately $1.95 billion (excluding the impact of foreign exchange) due to the COVID-19 pandemic, comprised of approximately $1.8 billion for pharmaceuticals and approximately $150 million for Animal Health, including the impacts in the first half of the year.
The full-year guidance includes its current assumption of the impact from the COVID-19 pandemic, which is expected to be partially offset by favorability from continued underlying business strength.
Source: Read Full Article