Pharma company sees double-digit rise in second-quarter revenues
A strong performance from multiple sclerosis drug Rebif helped Merck KGaA to a 12 per cent hike in second-quarter revenues to €2.85bn, although earnings were impacted by one-off charges.
Rebif (interferon beta-1a) rose almost 10 per cent to €492m, thanks to US price increases and the weak euro and despite increasing competition in the MS market.
Cancer drug Erbitux (cetuximab) also added 7 per cent to reach €226m while fertility drug Gonal-f (follitropin alfa) rose 17 per cent to €160m and diabetes treatment Glucophage (metformin) was up 19 per cent to €111m.
The strong performance by these established brands helped the group's Merck Serono unit to a healthy 11 per cent rise in revenues to €1.55bn.
Overall, the group reported earnings before interest, taxes, depreciation and amortisation (EBITDA) up almost 14 per cent to €747m, ahead of analysts' expectations.
The quarter also included some €394m in impairment charges related to various cost-cutting initiatives which pegged back operating profit to €23m.
The group is in the midst of a major streamlining operation that is reducing its headcount and shedding facilities, including Merck Serono's Swiss headquarters in Geneva. Earlier this year Merck said it was targeting savings of €300m by 2014 in the face of "unprecedented market shifts and increasing competition in key product areas".
Consumer health sales fell 3 per cent to €121m, with softer demand in Europe offset by gains in emerging markets, although the unit is becoming more profitable as a result of Merck's cost-cutting drive. Meanwhile, lab and manufacturing equipment unit Merck Millipore had a good quarter, with sales up 11 per cent to €649m.
"Merck reported solid second-quarter results due to healthy demand in all our businesses, tight cost management, and favourable currency exchange rates," said group chairman Karl-Ludwig Kley, who noted that underlying organic growth was nearer 5 per cent.
Merck now expects full-year revenues to come in at €10.7bn, up from its earlier €10.5bn forecast, with EBITDA of €2.85bn-€2.95bn.