Allergan Reports Third Quarter 2012 Operating Results
(IRVINE, Calif., October 30, 2012) - Allergan, Inc. (NYSE: AGN) today announced operating results for the quarter ended September 30, 2012. Allergan also announced that its Board of Directors has declared a third quarter dividend of $0.05 per share, payable on December 12, 2012 to stockholders of record on November 21, 2012.
Operating Results Attributable to Stockholders
For the quarter ended September 30, 2012:
Allergan reported $0.82 diluted earnings per share attributable to stockholders compared to $0.81 diluted earnings per share attributable to stockholders for the third quarter of 2011.
Allergan reported $1.06 non-GAAP diluted earnings per share attributable to stockholders compared to $0.92 non-GAAP diluted earnings per share attributable to stockholders for the third quarter of 2011, a 15.2 percent increase.
For the quarter ended September 30, 2012:
Allergan reported $1,391.1 million total product net sales. Total product net sales increased 6.1 percent compared to total product net sales in the third quarter of 2011. On a constant currency basis, total product net sales increased 9.4 percent compared to total product net sales in the third quarter of 2011.
Total specialty pharmaceuticals net sales increased 8.1 percent, or 11.4 percent on a constant currency basis, compared to total specialty pharmaceuticals net sales in the third quarter of 2011.
Total medical devices net sales decreased 4.0 percent, or 0.3 percent on a constant currency basis, compared to total medical devices net sales in the third quarter of 2011.
"In the third quarter, Allergan again delivered solid earnings growth in spite of the strong U.S. Dollar relative to virtually all major currencies," said David E.I. Pyott, Allergan's Chairman of the Board, President and Chief Executive Officer. "In addition, we were pleased to mark the opening of our new R&D facility in New Jersey, as well as to announce the expansion of our relationship with Molecular Partners."
Product and Pipeline Update
During the third quarter of 2012:
On August 21, 2012, Allergan and Molecular Partners AG announced that they have significantly expanded their existing relationship by entering into two separate agreements to discover, develop, and commercialize proprietary therapeutic DARPin® products for the treatment of serious ophthalmic diseases. The first agreement is an exclusive license agreement for the design, development and commercialization of a potent dual anti-VEGF-A/PDGF-B DARPin® ("MP0260") and its corresponding backups for the treatment of exudative (wet) age-related macular degeneration (AMD) and related conditions. The second agreement is an exclusive discovery alliance agreement under which the parties are collaborating to design and develop DARPin® products against selected targets that are implicated in causing serious diseases of the eye.
On September 4, 2012, Allergan marked the opening of the company's first large facility in the state of New Jersey. The new Research & Development Center, which will be specifically focused on clinical development, is a significant expansion of the company's footprint in New Jersey and is expected to eventually house several hundred employees.
On September 28, 2012, Allergan received approval from the Japanese Ministry of Health, Labor and Welfare (MHLW) for the NATRELLE® line of round silicone gel-filled breast implants and Style 133 tissue expanders. Allergan is the first company to receive approval from MHLW in Japan for breast implants for women undergoing breast augmentation, revision or reconstructive surgery.
Following the end of the third quarter of 2012:
Allergan is exploring strategic options for maximizing the value of its obesity intervention business, including among other things, a potential sale of that business unit. To the extent Allergan elects to pursue such a strategic option, the company intends to offset any potential earnings dilution related to the transaction.
On October 1, 2012, U.S. District Judge Andrew J. Guilford entered an order providing that the injunction against Merz Aesthetics prohibiting it from, among other things, selling or soliciting purchases of its product Xeomin® in the facial aesthetics market, shall remain in place until January 9, 2013. The order also provides that the terms of the injunction that restrict Merz Aesthetics' ability to sell and solicit purchases of its dermal fillers, as well as the terms that restrict Merz Pharmaceuticals' ability to sell and solicit purchases of Xeomin® in the therapeutic market, shall remain in place until November 1, 2012.
On October 12, 2012, the U.S. District Court in Santa Ana, California denied a motion by Athena Cosmetics, Inc. for reconsideration of the court's decision to grant Allergan's motion for summary judgment against Athena Cosmetics, Inc. on our unfair competition cause of action. In July 2012, the court granted Allergan's summary judgment motion, finding that Athena's Revitalash® line of products are drugs sold without approval and are therefore misbranded in violation of California law as well as the federal statutes which California law incorporates.
For the full year of 2012, Allergan expects:
Total product net sales between $5,695 million and $5,770 million.
Total specialty pharmaceuticals net sales between $4,775 million and $4,830 million.
Total medical devices net sales between $920 million and $940 million.
ALPHAGAN® franchise product net sales between $440 million and $450 million.
LUMIGAN® franchise product net sales between $600 million and $620 million.
RESTASIS® product net sales between $780 million and $800 million.
BOTOX® product net sales between $1,760 million and $1,800 million.
LATISSE® product net sales at approximately $100 million.
Breast aesthetics product net sales between $380 million and $390 million.
Obesity intervention product net sales at approximately $160 million.
Facial aesthetics product net sales between $380 million and $390 million.
Non-GAAP cost of sales to product net sales ratio at approximately 14%.
Non-GAAP other revenue at approximately $90 million.
Non-GAAP selling, general and administrative expenses to product net sales ratio at approximately 39%.
Non-GAAP research and development expenses to product net sales ratio at approximately 16%.
Non-GAAP amortization of acquired intangible assets at approximately $25 million. This expectation excludes the amortization of certain acquired intangible assets associated with business combinations, asset purchases and product licenses.
Non-GAAP diluted earnings per share attributable to stockholders between $4.17 and $4.19.
Diluted shares outstanding at approximately 308 million.
Effective tax rate on non-GAAP earnings between 27% and 28%.
For the fourth quarter of 2012, Allergan expects:
Total product net sales between $1,470 million and $1,545 million.
Non-GAAP diluted earnings per share attributable to stockholders between $1.18 and $1.20.
Thanks for reprinting the obvious. What needs to be discussed is Lapband and the rest of the Medical division. When is Pyott spinning off the implant side of the business? Does anyone think that implants will continue the 15% growth rate he is expecting???
I actually agree with management's call on the LapBand. It is a very profitable business but it is not fitting into the AGN's long term strategy. It's a great product, and a good and profitable business but it is perhaps AGN's only product that is most sensitive to, and most affected by the economic cycle.
The implant side of the business is extremely healthy and should be kept. This implant business is an expanding -- global -- business, and AGN is a major player in this market. Why would you abandon a lucrative and expanding market? AGN is position to become the global leader -- if it isn't already -- especially with the recent development with the primo positioning in the Japan implant market.
This is precisely the kind of product and position that AGN loves, and will make mammary implants a key part of the aesthetic mix for the long haul.
Dude, you need to do some more homework, or perhaps you were not actively listening to yesterday's conf. call.
Okay, the typical selloff following earnings with so many quality stocks. I am looking to buy again after we get some more facts on the table with the disaster aftermath and the elections stuff. I was fortunate to pull off some shares off on the last rally, and now, it is getting ripe again for money to flow back into it. I like $86-87 if I can get a chance.