AstraZeneca Falls on Disappointing Results
LONDON -- AstraZeneca is currently down more than 5% on the release of very disappointing full-year results for 2012. Revenue dropped some 15% (on a CER basis), to just under $28 billion, and pre-tax profit was down a massive 35%, at $7.7 billion, although it may provide some hope for recovery that the fall was only 5% in the fourth quarter.
The company blamed the poor performance on "the loss of exclusivity on several brands," including its $1 billion-a-year blockbuster Seroquel. But it's a situation that is not going to improve in the short term, with patent protection on another blockbuster -- the heartburn treatment Nexium -- due to expire next year.
Despite a 29% fall in reported earnings per share, the board has recommended a second interim dividend of 120.5 pence, which brings the full-year dividend to 178.6 pence -- giving a yield of almost 6% at the current share price.
The company will no doubt hope that increasing the dividend will help inspire some shareholder confidence, in the face of the announcement that it expects a decline in revenue approaching a double-digit percentage in 2013, with an even more significant drop in earnings per share.
Commenting on the results, new CEO Pascal Soriot said:
Our performance in 2012 reflects a period of significant patent expiry and tough market conditions globally. Despite the challenges we face, I am excited about AstraZeneca's fundamental strengths which will be key in returning the Company to growth and achieving scientific leadership while maintaining our reputation for strong financial discipline. It is my firm belief that we have the brands, science, pipeline and people to create distinctive, long-term value for patients and shareholders.
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The article AstraZeneca Falls on Disappointing Results originally appeared on Fool.com.
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