Merck said adjusted earnings for the three months ending in December were pegged at $1.16 per share, up 11.5% from the same period last year and one penny ahead of the Street consensus forecast. Worldwide sales, Merck said, rose 8% to $11.9 billion, just shy of analysts' forecasts of an $11.98 billion tally.
Merck also said it will spinoff its women's healthcare division into a separate company as it focuses on "growth pillars" in oncology, vaccines and hospital and animal health. Merck said the deal will create $1.5 billion in operational efficiencies by 2024, while creating a new organisation -- which will also include biosimilar drugs and legacy products -- with revenues of $6.5 billion a year.
“As evidenced by our results and our 2020 guidance, Merck had an extraordinary year and is in a position of operational and financial strength,” said CEO Ken Frazier. “It is this position of strength, born of our focused execution, that gives us the confidence to spin off our Women’s Health, trusted Legacy Brands and Biosimilar products into a new company, which will position us to deliver even greater value to patients and shareholders.”
Merck shares were marked 3.9% lower in early Wednesday trading following the earnings release to change hands at $84.92 each, a move that would trim the stock's six-month gain to around 2%.
Merck said sales of its key cancer treatment, Keytruda, rose 44.65% from last year to $3.11 billion, although that is a slower growth rate than the 65% pace recorded over the same period in 2018.
Looking into 2020, Merck said it sees non-GAAP earnings in the region of $5.62 to $5.77 per share, and full-year worldwide sales of between $48.8 billion and $50.3 billion.