* Q4 sales beat due to launch of quetiapine, ezetimibe
* Forecasts 2017 revenue, profit below estimates
* Shares rise as much as 6.47 pct to $14.15
(Adds conf call details)
By Natalie Grover
Feb 28 Endo International Plc's
quarterly revenue and adjusted profit beat estimates, driven by
two recently launched generic drugs, and new CEO Paul Campanelli
braced investors for a tough year ahead as the drugmaker enters
a period of transition.
With increasing pricing and competitive pressures in its
U.S. generics business, Endo is now looking to focus on organic
growth and drive margin improvements in 2017, Campanelli said on
a post-earnings conference call.
The Dublin, Ireland-based drugmaker's shares were up as much
as 6.47 percent at $14.15 in morning trading on Tuesday.
While the company beat relatively low quarterly
expectations, William Blair analysts still do not see a clear
path forward for sustainable growth, saying the erosion of
Endo's base business will likely overshadow new product
Campanelli led Endo's generics business until he took over
as CEO in September, inheriting a large debt load and mounting
pressure after previous management spent years relying on
acquisitions to foster growth.
Since his ascension to the helm, Endo has taken several
steps to streamline operations and invest in its core products,
particularly its Xiaflex injection, which is used to break down
Last month, Endo announced a restructuring program and
eliminated 90 jobs, and returned the rights to pain drug Belbuca
to BioDelivery Sciences International Inc.
Endo said on Tuesday it was divesting in the South
Africa-based Litha Healthcare Group for $100 million, and had
begun the process for the potential sale of its Mexico-based
Adjusted profit and revenue for the fourth quarter, ended
Dec. 31, beat Street estimates, driven by the launch of the
antipsychotic quetiapine and cholesterol treatment ezetimibe,
and demand for Xiaflex.
The drugmaker, however, forecast lower-than-expected 2017
revenue, a projection which is lower than its 2016 revenue of
$4.01 billion, as it continues to expect declines in its older
generics unit and legacy pain drug business.
Endo also forecast adjusted profit of $3.45-$3.75 per share
- including a significant impact from a higher adjusted
effective tax rate - below analysts' estimates.
"We suspect the first full-year forecast under new CEO Paul
Campanelli builds in some conservatism. There is no question
numbers are light but again, expectations heading in were also
very low," RBC Capital's Randall Stanicky said in a client note.
Endo's quarterly net loss attributable to shareholders
widened to $3.34 billion from $118.46 million, a year earlier,
after taking a $3.5 billion asset impairment charge in the
latest quarter, related to its generics unit.
(Reporting by Natalie Grover in Bengaluru; Editing by Martina