PARSIPPANY, N.J. (AP) — Actavis Inc. said took a loss in the second quarter on a large restructuring charge related to an acquisition.
The company, formerly known as Watson Pharmaceuticals, said the restructuring charges were connected to the combination of Actavis Group with Arrow Group. Watson bought Arrow, a British drugmaker, in 2009, before it combined with Actavis Group of Switzerland in 2012. Actavis also said its litigation costs increased. Sales of generic drugs climbed following the Watson-Actavis tie-up.
The company said it lost $564.8 million, or $4.27 per share, in the second quarter. A year ago it took a smaller loss of $62.2 million, or 49 cents per share. Excluding one-time charges, Actavis said it earned $2.01 per share, up from $1.42 per share a year ago. Revenue increased 47 percent, to $1.99 billion from $1.36 billion.
Analysts expected earnings of $1.99 per share on $1.98 billion in revenue, according to estimates compiled by FactSet.
Actavis said generic drug revenue rose 58 percent to $1.57 billion. Revenue from specialty drugs, or medications that require special handling, grew 21 percent to $144.8 million on sales of products including the contraceptive Generess Fe, enlarged-prostate drug Rapaflo, and pain drug Kadian. The company said revenue from its distribution business increased 14 percent to $275.8 million.
Shares of Actavis rose $2.10, or 1.7 percent, to $128.85 per share in morning trading. The stock reached an all-time high of $133 on May 22.
The company raised the low end of its annual profit guidance, saying it expects to earn between $8.15 and $8.50 per share in 2013, up from $8.10 to $8.50 per share. Actavis is forecasting $8.1 billion in revenue.
Analysts have projected earnings of $8.31 per share and $8.04 billion in revenue on average.
Actavis was formed in a $5.6 billion tie-up between Watson Pharmaceuticals and Actavis. After Watson bought Actavis Group it changed its name to Actavis Inc. In May the company agreed to buy Irish drugmaker Warner Chilcott PLC for $8.5 billion. The acquisition will expand Actavis’ women’s health and urology business and give it a range of dermatology and gastroenterology products.
Actavis said the new company will have about $11 billion in annual revenue. It expects the purchase to close during the second half of 2013 and will incorporate in Ireland as part of the deal.