Pfizer reported second-quarter earnings slightly ahead of forecasts Tuesday as the U.S.' largest drugmaker lines up a business split that could lead to the spin-off of its generics division.
The company, which has been hit by falling sales of its now off-patent cholesterol fighter Lipitor, reaffirmed its financial outlook for the year.
For the second quarter, adjusted income fell 10 percent to $4.00 billion, or 56 cents a share, from $4.45 billion, or 59 cents a share, a year earlier. Revenue fell 7 percent to $12.97 billion.
Analysts, on average, were expecting second-quarter income of 55 cents a share, on revenue of $13.01 billion, according to Thomson Reuters I/B/E/S.
Pfizer (PFE), whose CEO Ian Read has been reviewing the group's structure after divesting its nutrition and animal health businesses, said Monday it planned to separate its commercial operations into two units for branded products and a third for generics.
Read said Pfizer's new model would help revitalize its innovation-based core drugs business, while enhancing the value of consumer and off-patent established brands, and maximizing the use of capital.
Pfizer's generics business, which represents 17 percent of total sales, has far lower profit margins than its patent-protected drugs.
Many analysts have urged Pfizer to spin off its generics business so it can focus on its core branded pharmaceuticals, although such a move is unlikely before 2016.
Within the core drugs division, revenues from cancer medicines increased by 28 percent in the second quarter, helped by new products like Inlyta and Xalkori.
Read also said he expected business in emerging markets to accelerate in the second half of the year, led by China.
"From a total company view, we are tracking to our expectations for the full year and continue to capitalize on the investments we are making to better position Pfizer for long-term success," he added.
Pfizer reiterated that it expected full-year earnings of $2.10 to $2.20 a share.
Lipitor and Prevnar Hits
The 7 percent fall in quarterly revenue reflected an operational decline of 4 percent and an unfavorable impact from foreign exchange of 3 percent.
Operationally, the biggest hit came from losses of exclusivity on Lipitor, while shifts in government purchasing patterns for bulk orders of Pfizer's Prevnar pneumococcal vaccine also took their toll.
The U.S. drugmaker's determination to reshape its business is part of a wider trend by pharmaceutical companies around the world to divest slower-growing and maturing operations.
Abbott Laboratories' (ABT) decision to split off its innovative drugs into AbbVie, in particular, has fueled a wider rethink across the industry as to whether other companies or groups of investors may be better owners for certain assets.
In Europe, GlaxoSmithKline (GSK) is also selling off certain non-core brands, and in April it took a similar tack to Pfizer by opting to bundle many of its established drugs into a new unit.
Pfizer last November sold its nutrition business to Nestle SA for $11.85 billion in cash and in February spun off its animal health business into a new company called Zoetis.
Save Money, Fight Climate Change: 5 Ways to Stay Cool This Summer
It's basic physics: light colored roofs reflect light -- and heat -- while darker ones absorb it. For all the simplicity of the idea, the potential savings impact is huge: Homes with light colored paint or shingles can cost up to 20 percent less to cool. Plus, all that solar energy causes dark-colored shingles to wear out more quickly, shortening the life of the roof. (For more detail, check out our Savings Experiment video below.) So if you're due for a roof replacement anytime soon, consider cooling off your roof with lighter shingles, or aluminum panels painted white.
As a side note, if your roof is flat, you might consider installing a green roof. Not only do they provide a great place to plant veggies, but green roofs can help conserve water while lowering your heating and cooling costs even further!
This seems pretty obvious, but if you're in the middle of a heat wave, try not to cook indoors. If you have the option, grill outside; alternatively, try a picnic-style dinner of sandwiches, salads, gazpacho, and other chilled foods.
While you're at it, you might want to cut down on other sources of indoor heat, like incandescent lights, hair dryers, clothes washers and dryers, and dishwashers. Try running washers and dryers at non-peak hours, think about installing CFL bulbs, make sure to turn off your lights, and keep appliances properly cleaned and serviced so they run at maximum efficiency.
Most of the cooling that you feel on a daily basis comes from liquid evaporating off your skin. With that in mind, you'll find that you'll stay much cooler if you keep lots of air moving around. Strategically placed fans keep cool air moving. Experiment with cross-ventilation: on the shady side of your house, position your fans to blow air in. Meanwhile, on the sunny side, position fans to blow air out.
You don't have to rely on perspiration -- or even on fans -- to keep your body cool. You can help things along with a cold, water-soaked washcloth or with a misting spray bottle filled with water. If you really need to cool down, take a short shower, followed by a long, relaxing nap in front of a fan.
If it gets really hot and you really want to save on cooling, you'll need to get creative. Try going to the park -- or anywhere with trees -- cooling your heels in the local library, or strolling around the mall. Drink a lot of water. Avoid coffee, alcohol and soft drinks, as they can dehydrate you. Personally, I've found that showering with Dr. Bronner's Peppermint Magic Soap makes me feel a few degrees cooler (although, admittedly, the effect is diminished once temperatures go over 90 degrees). Or you could get really creative: BrokeMillennial advises snuggling up with bottles of frozen water to help keep you cool at night!