Belgium's UCB posts disappointing 2009 results, but projects better future based on newer drugs

UCB, Belgium's last surviving significant drugmaker after the sale of Solvay Pharma to Abbott Laboratories, disappointed investors with its 2009 financial results, which saw revenues plunge 13% to 3.1 billion euros ($4.23 billion) impacted by generic competition to its epilepsy drug Keppra (levetiracetam) in the USA and divestitures, such as of non-core businesses in emerging markets to UK drugs giant GlaxoSmithKline and a hyperactivity drug to Shire.

UCB shares proved volatile in early trading yesterday after the announcement, falling as much as 4.8% and gaining up to 2.1%, with bullish long-term forecasts but the weak 2010 outlook

The company posted a 5% decline in underlying profitability (recurring EBITDA) of 698 million euros, which it said is well in line with company guidance (more than 680 million euros) and reflecting the significant impact of generic competition to Keppra in the USA, mostly compensated by lower operating expenses as a result of UCB's focus on its core activities. Net profit after minorities increased to 513 million euros in 2009 from just 42 million euros in 2008, reflecting higher non-recurring income stemming from capital gains and overcompensating non-recurring charges relating to the debt refinancing and organizational changes, the drugmaker said.