Charges and generics hit AstraZeneca's 3rd-qtr, as net profit falls 15%

UK-headquartered pharmaceutical major AstraZeneca has reported a set of results for the third quarter of 2007 which, despite seeing a downturn in profitability, still managed to just exceed consensus expectations. The reporting period was impacted by charges, including those related to the acquisition of MedImmune, which is being integrated with an earlier buy - Cambridge Antibody Technology in May 2006, as well as restructuring, along with generic competition, most notably on its antiulcerant Nexium (esomeprazole).

Sales for the three months reached $7.15 billion, a rise of 6% (on a constant exchange rates basis), with operating profit declining 7% to $2.02 billion, pretax profit at $1.89 billion, a fall of 16%, and earnings per share down 13% at $0.91. Although the shares dipped immediately after the release of the results, they stabilized later, rising 0.3% on the London Stock Exchange. However, the stock ended the day 1.8% lower, although this should be viewed against the FTSE 100's plunge of over 2%.

Chief executive David Brennan remained upbeat, noting that the company continues "to progress its key priorities and the business is on track to meet its earnings target for the full year, the entire organization is driving for increased productivity and the pipeline has been further strengthened with two projects added to Phase III development during the quarter."