Generic drugmaker Mylan Inc.'s first-quarter net income fell 17 percent, as research and development costs climbed and foreign exchange rates crimped revenue, but earnings still topped analyst expectations.
The Canonsburg, Pa., company said Thursday after markets closed that it earned $106.9 million, or 27 cents per share, in the three months that ended March. 31. That compares to earnings of about $129.1 million, or 30 cents per share, in last year's quarter, when the company had more shares outstanding.
Adjusted earnings totaled 62 cents per share, not counting items like amortization and acquisition related costs.
Total revenue climbed 3 percent to $1.63 billion despite a 2 percent hit from unfavorable foreign exchange rates.
Analysts expected, on average, earnings of 61 cents per share on $1.69 billion in revenue, according to FactSet.
Mylan said its research and development costs climbed 56 percent to $126.5 million mainly due to licensing payments and the development of respiratory and biologics programs.
Acquisition-related costs also helped push up selling, general and administrative expenses by about 4 percent in the quarter to $351.4 million.
Mylan said it still expects to earn $2.75 to $2.95 per share for the year; analysts expect $2.87 per share.
Susquehanna Financial Group analyst Andrew Finkelstein said Mylan's revenue came in lower than expected in the quarter mainly due to lower generics sales in North America. But he expects that new product launches will help revenue pick up in the second quarter.
Finkelstein repeated a "Positive" rating and $33 price target on the shares.
Shares of Mylan closed Thursday at $28.83, up about 5 percent for the year to date.