AstraZeneca yesterday revealed a significant upturn in its performance, with operating profit boosted a staggering 53% to $1.7 billion dollars, as sales too saw double-digit growth of 13% to $6.1 billion. The firm’s incumbent chief executive, Sir Tom McKillop, will be hoping that this performance continues - enabling him to leave on a high at the end of the year after several high profile product disappointments [[28/07/05a]].
“Strong sales growth and productivity gains have delivered an outstanding first-half performance leading to higher shareholder returns and an increase in financial targets for the full year,” Sir Tom noted. For the first six months, AstraZeneca reeled in a record $12 billion dollars in sales, driven by sales of key products – up 25%. Top of the tree was the Losec (omeprazole) follow-up Nexium (esomeprazole), which saw revenues up 22% to $2.3 billion for the first half, while the antipsychotic Seroquel (quetiapine) also put in a sterling performance, up 37% to $1.3 billion, and was closely followed by Arimidex (anastrozole) for cancer, which just surpassed the $1 billion mark, up 50%.
And the company will also have been smiling on news that its highly scrutinised cholesterol-lowering drug Crestor (rosuvastatin) seems to be making a recovery – with revenues jumping 72% to $590 million. AstraZeneca says that, as of mid-July, Crestor’s share of new prescriptions in the US statin market was 6.2%.
Following two quarters of robust sales and excellent productivity gains, AstraZeneca says it now expects to exceed the earnings guidance set at the beginning of the year. Sales growth is now expected to approach double digits in constant currency, and earnings per share is now anticipated to be above $2.75, implying an operating margin around 27% for the full year. This performance creates a platform for good earnings growth in the following two years.