Merck Beats Q1 Estimates, Shares Rise

Shares of

jumped over 4 percent in pre-market trading after the company reported upbeat results for the first quarter. For the year, Merck now projects earnings of $3.35 to $3.48 per share, versus its earlier forecast of $3.32 to $3.47 per share. The Kenilworth, New Jersey-based company reported quarterly earnings of $953 million, or $0.33 per share, compared to $1.71 billion, or $0.57 per share, in the year-ago period. Excluding certain items, the company's earnings declined to $0.85 per share from $0.88 per share. Its sales shrank to $9.43 billion from $10.26 billion. However, analysts were expecting earnings of $0.75 per share on revenue of $9.07 billion. Pharmaceuticals sales slipped 2 percent to $8.27 billion in the quarter, while sale at its animal health division gained 2 percent to $829 million. Sales of Remicade dropped 17 percent to $501 million, while sales of Zetia/Vytorin fell 9 percent to $887 million. Sales of Januvia/Janumet rose 4 percent to $1.39 billion in the quarter, while ISENTRESS sales fell 1 percent to $$385 million. The gross margin widened to 62.1 percent for the first quarter, from 62.0 percent in the year-ago quarter. On a non-GAAP basis, marketing and administrative expenses fell to $2.3 billion from $2.7 billion, while R&D expenses rose 10 percent to $1.7 billion. The average estimate among 28 Estimize users was for earnings of $0.77 per share and revenue of $9.07 billion. "Our strong performance this quarter demonstrates that our scientific and business strategies, together with our focused investments, are paying off," Chairman and Chief Executive Officer Kenneth C. Frazier said. The executive added, "We remain focused on bringing forward the best scientific and medical innovations." Merck shares gained 4.74 percent to $59.80 in pre-market trading.