An Update on Quarterly Results - Report on Merck

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Sep 15, 2015, 09:10 ET

NEW YORK, September 15, 2015 /PRNewswire/ --

ACI Association has initiated research coverage on Merck & Co. Inc. (NYSE: MRK). Select highlights from the internally released reports are being made available to the general public (included below), with access to the entirety of the research available to new members.

Today, membership is open to readers on a complementary basis at the following URL: http://www.aciassociation.com/reports?keyword=MRK

Highlights from our MRK Report include:

Top-line Performance - On July 28, 2015, health care provider Merck & Co. Inc. announced results for the second quarter of 2015. During Q2 2015, the worldwide sales decreased 11% year-over-year to $9.8 billion. Sales growth for the quarter was impacted by a 7% adverse impact from foreign exchange fluctuations and an unfavorable impact of 7% arising from the divestiture of the Consumer Care business and select products. The acquisition of Cubist Pharmaceuticals, Inc. (Cubist), however, partially offset the negative impact.

Segment-wise Results - Pharmaceutical sales declined 6% YoY to $8.6 billion, including a 9% negative impact from currency volatility. Excluding the unfavorable foreign exchange impact, growth was primarily driven by sales in core therapeutic areas of hospital acute care, oncology and diabetes. In the Animal Health segment, sales declined 4% YoY to $840 million in Q2 2015 including a 14% negative impact from foreign exchange. Excluding the impact, growth was driven by higher sale of companion animal and swine products. Other revenues, which chiefly include alliance revenue, miscellaneous corporate revenues and third-party manufacturing sales, came in at $381 million, down 3% YoY. The decline was driven primarily by the loss of revenue from AstraZeneca, partially offset by higher third-party manufacturing sales.

A Quick Look at the Bottom-line - Non-GAAP earnings per share (EPS), which excludes acquisition and divestiture related costs, restructuring costs and certain other items, including foreign exchange losses related to Venezuela, stood at $0.86 for Q2 2015 as compared to $0.85 for Q2 2014. GAAP EPS, on the other hand, was reported at $0.24, as against $0.68 in the corresponding period a year ago.

Outlook for the Full Year - The Company narrowed and raised its guidance for the full year 2015 non-GAAP EPS which is expected to be in $3.45 to $3.55 range, including a negative impact from foreign exchange. Estimates for GAAP EPS for 2015 were lowered to $1.52-$1.71 range. At current exchange rates, the Company anticipates full-year 2015 revenues to be in $38.6 billion-$39.8 billion range, including a negative impact from foreign exchange and approximately $1 billion of net lost sales from acquisitions and divestitures.

To find out how this influences our rating on Merck & Co. Inc., read the full report in its entirety here: http://www.aciassociation.com/reports?keyword=MRK

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