Perrigo income tops charts at $90 million

February 4, 2011
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ALLEGAN — Perrigo Co. reported record quarterly revenue and earnings and boosted its earnings per share guidance for the remainder of the fiscal year.

Secord quarter net revenue from continuing operations were $717.5 million, a 23 percent increase from the previous second quarter. Income increased to $90.1 million, 43 percent higher than the second quarter of 2010.

For the first six months of fiscal 2011, net sales were $1.35 billion, a surge of 22 percent over $1.1 billion in the first half of fiscal 2010. Reported income saw an increase to $89.7 million from $62.7 million one year ago.

That has prompted the company to increase its diluted earnings per share guidance on continuing operations from $3.75 to $3.90 per share, from $3.60 to $3.75.

A sales increase of 119 percent, to $133 million, in its new nutritional division includes $86 million from Virginia-based infant formula maker PBM Holdings Inc., which Allegan-based Perrigo acquired one year ago.

The company’s core consumer over-the-counter generic business reported a 3 percent in sales over last year’s second quarter, from $417 million to $430 million. It attributed $7 million in sales to the 2010 acquisition of Australian OTC and hospital pharmaceutical supplier Orion Laboratories.

“We had a very strong first half of the year, record earnings and continued strong demands for our products in every segment,” Chairman and CEO Joseph Papa said.

In January, Perrigo announced it would acquire the privately-held Paddock Labs of Minneapolis, which makes and markets generic prescription drugs, for $540 million. The new acquisition is expected to eventually add $600 million in sales at Perrigo, the company said.

Manufacturing output has increased by about 24 percent, Papa said. The company is working through issues raised in an FDA Warning Letter last year, such as metal shavings in ibuprofen, mixing ibuprofen pills, and problems with packaging and labeling.

“We plan to get the Warning Letter remediated as soon as possible and look forward to the FDA’s reinspection in the future,” Papa said.

Looking forward, Perrigo last year acquired exclusive U.S. store brand rights to sell generic versions of popular allergy drug Allegra, potentially a huge market that is awaiting FDA approval to move it from prescription to OTC status. The company’s move to generic Mucinex is still tied up in litigation, Papa added.

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