Endo Health Solutions Inc. said Tuesday its net income rose in the second quarter despite a series of charges related to its planned shift in business strategy and an allowance for potential lawsuits.
The company also raised its full-year guidance, but shares slipped in afternoon trading
In June Endo said it planned to cut 15 percent of its staff positions, or about 700 jobs, and would consider strategic options for its HealthTronics urology business and its branded drug development platform. The company also set aside approximately $60 million for potential product liability claims. A year ago the company set aside $131 million to cover the costs of litigation with Actavis Group Inc., which was trying to sell a generic version of Endo’s Lidoderm pain patch.
Endo said its net income grew to $35 million, or 30 cents per share, from $9.5 million, or 8 cents per share, from. Excluding one-time charges the company earned $1.42 per share, up from $1.27 per share a year ago. Revenue slipped 2 percent, to $766.5 million from $785.2 million.
Analysts forecast income of $1.15 per share and revenue of $720.7 million, according to FactSet.
Endo said revenue from its pharmaceutical business fell 6 percent to $416 million on lower sales of its pain drug Opana ER, which is now competing with low-cost generic versions. Sales of Opana ER got a temporary boost in the 2012 quarter because wholesalers were stocking up on the drug after supply problems.
Revenue from the company’s Qualitest generic drug business rose 7 percent to $171 million, while revenue from its urology products and services division American Medical Systems fell 2 percent to $126 million.
Endo said its cost-cutting moves to reduce annual spending by about $325 million are on track, and it plans to focus on developing drugs that will bring it more revenue in the near future like generic drugs and lower-risk projects.
Looking ahead, the company said it now expects to report adjusted income of $4.25 to $4.55 per share in 2013 on revenue between $2.7 billion and $2.8 billion. Endo previously forecast net income of $4.10 to $4.40 per share and $2.65 billion to $2.8 billion in revenue.
Analysts are calling for $4.33 per share and $2.75 billion, on average.
Endo shares lost $1.27, or 3.3 percent, to $37.44 in afternoon trading.
