Valeant swings to 1Q profit, but adjusted results miss views

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May 7, 2008

ALISO VIEJO, Calif.—Valeant Pharmaceutical International on Wednesday said that its first-quarter profit edged up slightly, though adjusted for continuing operations, the specialty pharmaceutical company posted a loss, missing Wall Street expectations.

The company earned $9.5 million, or 11 cents per share, compared with $9.3 million, or 10 cents per share, in the prior-year period. Excluding discontinued operations and certain one-time costs and gains, the company lost $3.9 million, or 4 cents per share, in the latest period. In the year-ago period, adjusted income from continuing operations totaled 20.6 million, or 21 cents.

Revenue fell 5 percent to $194.7 million from $204.4 million.

Analysts polled by Thomson Financial expected a profit of 2 cents per share on revenue of $193.1 million.

"The financial results from this quarter continue to highlight the need for decisive change at Valeant," Chief Executive Officer J. Michael Pearson said in a statement. "We have initiated steps to address our cost base and return this company to growth and sustained profitability."

The company, whose products are focused on neurology, dermatology and infectious disease, has undergone many changes of late. Pearson joined the company in February, replacing Timothy Tyson. Valeant has also cut costs, selling off its hepatitis C drug Infergen in a deal that closed in January. The transaction resulted in a $70.8 million payment, though Valeant expects to receive additional payment totaling $20.5 million in the next 12 to 18 months.

In addition, the company divested subsidiaries and product rights in Asian countries in a deal that closed in March for $37.9 million.

Shares of Valeant were down 23 cents, or 2 percent, to $12.85 in midday trading.