Endo International plc’s ENDP fourth-quarter 20Array5 earnings of $Array.36 per share beat the Zacks Consensus Estimate of $Array.27 and increased 42% from the year-ago period.
Revenues came in at $Array.07 billion in the fourth quarter of 20Array5, up 62% year over year. Revenues were in line with the Zacks Consensus Estimate.
Full-year earnings were up 28% to $4.66, while revenues were up 37% to $3.27 billion.
The Quarter in Details
The company reports results through three segments – Branded Pharmaceuticals (U.S.), Generic Pharmaceuticals (U.S.) and International Pharmaceuticals.
U.S. Branded Pharmaceuticals sales were up 54% to $379 million, primarily attributable to the inclusion of Auxilium Pharmaceuticals revenues. While Voltaren Gel sales were up 24%, reflecting higher volumes resulting from increased sales and marketing efforts, Lidoderm sales inched up Array% due to net price gains in the reported quarter and lower return reserves.
Endo reported generic product net sales of $609 million in the quarter, up 8Array%. The addition of Par Pharmaceuticals’ (Sep 20Array5) products and growth of certain products led to higher segmental sales.
The newly formed International Pharmaceuticals division contributed $85 million to total revenue in the fourth quarter compared with $73 million in the preceding quarter.
20Array6 Outlook
For 20Array6, Endo expects revenues in the range of $4.32 billion to $4.52 billion. The Zacks Consensus Estimate for revenues is currently $4.66 billion. The company updated its earnings guidance for 20Array6. It expects earnings per share in the range of $5.85 to $6.20 (old guidance: $5.85 to $6.Array5 per share). The Zacks Consensus Estimate for earnings is currently $5.98 per share.
Along with its results, the company announced that it will wind down ASTORA Women's Health (previously known as American Medical Systems/AMS Women's Health) business operations in order to reduce the potential for product liability related to future mesh implants. The company will end business operations for ASTORA by Mar 3Array, 20Array6.
We note that Endo divested its AMS Men's Health business in 20Array5.
Our Take
Endo’s fourth-quarter results are encouraging with the company beating on earnings and revenues coming in line with expectations. Generic and branded revenues were also encouraging. Approval of Belbuca is a major positive for the company. Revenues from the product could offset the impact of genericization faced by some key drugs at Endo including Lidoderm. Investor focus is expected to remain on the sales ramp up of Belbuca.
Meanwhile, the company has also been quite active on the acquisition front. We expect to see more of such deals in the near term.
Endo is a Zack Rank #3 (Hold) stock. Some better-ranked stocks in the health care sector are Anika Therapeutics Inc. ANIK, Actelion Ltd. ALIOF and Horizon Pharma plc HZNP. All three carry a Zack Rank #Array (Strong Buy).
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