Shire raises full-year growth forecast; shares jump
Stock in Shire Plc jumped more than 2 per cent after the pharmaceutical firm reported better-than-expected first-quarter earnings and raised its growth forecast for 2014.
Dublin-based Shire announced that its earnings, excluding some items, soared 40 per cent to $591 million, or $2.36 per American depositary share, in the January-March quarter of this year. Analysts had projected an average profit of $552.8 million or $2.21 per American depositary share for the company's first quarter.
The company also raised growth forecast for the current year, saying it its earnings per American depositary share, excluding some items, would likely grow in the mid-to-high 20 per cent range. The company's previously similar level growth forecast was for 2013, when the figure was 23 per cent.
Commenting on Shire's new forecast, UBS analyst Guillaume Van Renterghem said, "Clearly the fact that they beat is simply because they are cutting costs. One way of looking at it is that maybe they are trying to clean up everything so that they're more appealing to someone willing to buy them."
The company will be able to bring down costs as some clinical trials have ended wile some more will end I the near future.
Shire also expressed hope that sales of its psychiatric drugs would growth to double by the end of 2020, and that its new adult ADHD drug SHP465 would hit US medicals stores as early as the first half of 2015.
Shire shares jumped 2.1 percent to hit a record level of 3,450 pence apiece in London in after-hours trading on Thursday. The stock has gained nearly 71 per cent in the past twelve months, emerging as the best performer in the Bloomberg Europe Pharmaceutical Index.