Israeli generic drug maker Teva Pharmaceutical Industries says earnings jumped sharply in the first quarter of 2018 as it pressed forward with an aggressive cost-cutting program.
Teva said it posted net income of $1.1 billion, or $1.03 a share, compared to $580 million, or 57 cents a share, a year earlier.
Chief Executive Kare Schultz said on Thursday the year was off to a “solid start” and raised his 2018 guidance to $18.5-19 billion from $18.3-18.8 billion and raised the EPS forecast to $2.40-2.65 per share from $2.25-2.50.
Schultz says the company is on track to meet cost-cutting targets, which include reducing one-quarter of the company’s workforce, and is reducing its $30 billion debt load.
“During this quarter, our strong cash flow allowed us to continue to reduce our outstanding debt, and together with our recent debt issuance and covenant amendment, has placed Teva on a more stable financial footing.
“We have also benefited this quarter from the durability of Copaxone and a steady flow of generic launches in the U.S. Our strong first quarter performance, along with our confidence in executing the restructuring program, gives us a solid foundation to raise our guidance for the year,” Schultz stated.
The improved earnings came despite a 10 percent drop in revenue to $5.1 billion. It cited the deteriorating U.S. generics market and generic competition to its blockbuster MS drug Copaxone.
The first quarter of 2018 – the first full quarter in which the CEO has been at the helm – would seem to confirm the confidence shown in him by the board of directors and market anlaysts.
He took over on November 1 and “the global streamlining plan that he has implemented already seems to be paying off,” said Globes on Thursday. It noted also the company’s share price was up over 8 percent in pre-market trading on the NYSE to $20.12.