AmerisourceBergen inks healthy profit
VALLEY FORGE, Pa. Booming demand for higher-margin generic drugs and specialty pharmaceuticals propelled earnings at AmerisourceBergen Corp., the wholesale and health services giant reported Thursday.
Despite an economy on life support and a drop in overall revenues, net income rose 7.1% to $143.4 million in the second quarter ended March 31, ABC announced. On a per-share basis, net income rose 17% over the second quarter of last year, to a record 95 cents per share.
Fueling the rise in per-share earnings: the company’s total net profits were spread among fewer shares.
“Diluted average shares outstanding for the second quarter of fiscal year 2009 were 152.3 million, down nearly 11 million from the previous fiscal year’s second quarter due primarily to share repurchases,” the company revealed.
Sales for the period fell 2.5% to $17.3 billion, “due primarily to a 4% decrease in AmerisourceBergen Drug Corporation revenue and one less business day than in the prior-year’s second quarter, offset in part by an 8% increase in AmerisourceBergen Specialty Group revenue,” the company reported.
ABC’s leadership expressed delight at the results.
“Our outstanding operating results in the March quarter reflected the continued strong performance of our two growth drivers, generic drug distribution and our specialty distribution and related services business, as well as continued cost discipline,” said president and CEO R. David Yost. “Revenue in the quarter was down 2.5 %, but would have increased 3% when adjusted for one less business day than the previous year’s second quarter and the negative impact of the July 1, 2008 loss of the direct-to-warehouse business of a large retail drug chain.
“The rise in profitability was driven by a double-digit increase in generic drug sales; excellent performance in our higher-margin specialty business; good performance under our fee-for-service contracts with manufacturers; and solid expense control,” Yost added. “Our receivable days were again down in the quarter; our balance sheet remains strong; and we have good financial flexibility.”