AstraZeneca (NYSE:AZN) revealed its 4th quarter as well as full year’s earnings recently; the results did very little to attract investors’ attention. The core Earnings per Share for the quarter was reported to be at 10.5%, which is less than the consensus at $0.76. Hence, a 28% decline is seen from last year’s result. However, the revenue collected by the company matched estimates of $6.683 billion.
The British based pharmaceutical company revealed its full-year’s core earnings per share of $4.28 which just missed the consensus, by a mere 2% and shows a year-over-year decrease of 8%. The yearly revenue collected by the company remained below the Streets estimates by about $600 million at $26.1 billion. The company declared a total loss of $0.25 per share on a non-adjusted basis for the quarter.
The earnings per share for the whole year declined 52% on non-adjusted basis.
Fields of concern:
In the 4th quarter, the sales of Nexium declined by 16% on non-adjusted basis to $832 million. For the whole year, the sales of Nexium declined by 6%. The company’s most popular drug called Crestor which is used for controlling cholesterol also saw a quarterly decline in sales by 5% to $1.38 billion. However, as per the management this dip in sales was a result of 4% decline that was seen in the prescriptions for the time period of three months as compared to a year ago and also the negative influence of the Branded Pharmaceutical Fee.
Another popular drug Synagis which is used for treating respiratory syncytial Virus also reported a decline in its quarterly sales of 22%. This decline in sales is a result of latest guidelines which were issued by American Academy of Pediatrics Committee. The guidelines imposed restrictions on what kind of patients can or cannot purchase the medicine.
Overall, 3 out of the 4 major products by AstraZeneca (NYSE:AZN) have reported decline in sales. While some of the decline can be a result of the company’s loss of patent protection, however another reason can also be that the company’s products are facing tough competition with newer medicines in the market.
All is not bad:
The company did have some good news to share. Like in the 4th quarter, the heart medicine by AstraZeneca (NYSE:AZN) called Brilinta saw a boost in its sales by 45% and for the full-year the medicine saw a sales increase of about 70%. If the sales of the medicine continue to rise at this rate then in 2015 it will reach to another level of success.
The company’s diabetes drug also saw a boost in its sales by 139% in the year 2014 while the yearly sales of the respiratory drug increased by 10%. On the clinical front, AstraZeneca (NYSE:AZN) reassured the investors that the company is making good progress. The pharmaceutical company managed to gather 6 regulatory approvals in the year 2014 and also has 118 clinical trials under progress.
Should investors consider AstraZeneca (NYSE:AZN) a risk?
In the coming years, the company is expected to report declining results as one of the company’s drugs is facing a law suit over safety issues. Although the management at Astra Zeneca (NYSE:AZN) is hopeful about its field of immuno-oncology and believes that it will help in the growth of the company and the company will be able to bounce back by 2017.
However, there is no guarantee which is why it will be wiser for investors to wait and see in which direction the company will go.
