Elan deal hits Perrigo profits
The New York-listed company — the leading maker of generic over-the-counter drugs in the US — yesterday reported third quarter net profits of $48.1m for the three months to the end of March, down by 57% on a year-on-year basis.
For the first nine months of its financial year (which runs to the end of June), the company posted a net profit of $73.4m, down by 77.3% on the same period last year.
A big hit to Perrigo’s bottom line growth came via the one-off costs related to its near $9.5bn purchase of Dublin-based Elan at the end of last year.
The acquisition-related costs included administration expenses of nearly $109m, $10m in interest payments and almost $166m lost on extinguishing Elan’s debt.
The US firm also paid cash consideration of $16.1m to Elan’s stock option and share award holders for the unvested portion of their awards in the second quarter of its current financial year.
The company incurred Elan takeover-related costs of $1.2m for the three months to the end of March. The $285m cost covers the first nine months of its current fiscal year.
Last year, Perrigo said that the company could benefit from around $150m in annual tax savings from acquiring Elan.
In yesterday’s earnings update, Perrigo said that ‘fiscal 2015’ should see it have a lower annual effective tax rate because of the deal.
Perrigo’s third quarter net sales amounted to just over $1bn, up from just under $920m last year, while its revenues for the nine months to the end of March rose by 3.4% year-on-year, to almost $2.92bn.
Basic earnings per share — for the nine months — jumped from 93.8c to 108.9c; with third quarter earnings going from 94c to 109.4c.
