Shire Pic (SHPG) Tops Q2 EPS by 22c; Updates Outlook

Shire Pic (NASDAQ: SHPG) reported Q2 EPS of $2.67, $0.22 better than the analyst estimate of $2.45. Revenue for the quarter came in at $1.5 billion versus the consensus estimate of $1.45 billion.

OUTLOOK

We have again delivered record quarterly results and following our strong performance in the first half of 2014, we are increasing our guidance for Non GAAP diluted earnings per ADS to low-to-mid thirty percent growth for the full year 2014 (previous guidance: mid-to-high twenty percent growth).

After a strong first half product sales performance, we now expect to see high teens product sales growth for the full year 2014 (previous guidance: mid-to-high teens).
We continue to expect royalties and other revenues to be 10-15% lower than 2013.

We continue to anticipate that our Non GAAP gross margin will be approximately 1 percentage point lower than in 2013.

We expect our operating costs to continue to benefit from our reorganization efforts and focus on operational discipline shown in the first half of the year. As a result, we now anticipate Combined Non GAAP R&D and SG&A to grow by 2-4% compared to 2013 (previous guidance: 4-6% higher).

We are expecting higher Combined Non GAAP R&D and SG&A in the second half than the first half of 2014, as we continue to invest behind our innovative and exciting pipeline, which now includes programs acquired with Fibrotech Therapeutics Pty Ltd. (“Fibrotech”) and Lumena Pharmaceuticals Inc. (“Lumena”). The second half will also see commercial spending on the anticipated launch of SHP465 in the US and XAGRID in Japan, Binge Eating Disorder disease awareness investments and the continued international expansion of VYVANSE.

Following the cash refunds received and expected from the Canadian revenue authorities, and stronger operational cash flows, we now expect Non GAAP net interest expense to be approximately $10 million lower than in 2013 (previous guidance: at a similar level to 2013).

Our core effective tax rate on Non GAAP income is now expected to be in the range of 17-19% (previous guidance: range of 18-20%).

Taken together, our upgraded Non GAAP diluted earnings per ADS growth for the full year 2014 is now expected to be in the low-to-mid thirty percent range.

For earnings history and earnings-related data on Shire Pic (SHPG) click here.

You May Also Be Interested In

• Bristol-Myers Squibb (BMY) stock slips despite earnings beat
• Wausau Paper (WPP) Q1 Revenue Misses Estimates
• S&P Global (SPGI) Tops Q1 EPS by 36c; offers guidance