Eli Lilly Lifts Estimates - TheStreet

Eli Lilly Lifts Estimates

Second-quarter earnings are better than expected.
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Eli Lilly

(LLY) - Get Report

on Tuesday produced a better-than-expected earnings report that prompted the Indianapolis-based drugmaker to raise its full-year forecast.

"We are encouraged by our outlook for the remainder of the year," said Sidney Taurel, the chairman and chief executive, in a prepared statement, as Lilly boosted its full-year guidance by 11 cents, excluding one-time items, to a range of $3.40 to $3.50.

Analysts had been looking for $3.38. This is the second time Lilly has lifted its targets, and the news sent its stock up $1.18, or 2.1%, to $58.35.

Lilly joined

Merck

(MRK) - Get Report

and

Wyeth

(WYE)

in

raising estimates after the recent release of

their own second-quarter results.

For the three months ended June 30, Lilly earned 90 cents a share, excluding items, or 8 cents higher than the consensus of analysts polled by Thomson First Call. Revenue of $4.63 billion beat the average estimate of $4.39 billion.

When all items were included, Lilly earned $663.6 million, or 61 cents a share. For the same period last year, Lilly earned $822 million, or 76 cents a share, on revenue of $3.87 billion. Lilly's reported earnings for the just-completed quarter included 29 cents in charges related to a pair of acquisitions.

Lilly also forecast a third-quarter EPS of 85 cents to 87 cents, excluding items, compared with the consensus of 86 cents.

"We have increasing cash flow and a strong balance sheet" to invest in growth and research, John Lechleiter, the president and chief operating officer, told analysts during a telephone conference call.

Among major products, the strongest growth came from Cymbalta, whose sales jumped 67% from last year to $519.5 million. Cymbalta is prescribed for depression, general anxiety disorder and nerve pain associated with diabetes. During this quarter, Lilly will seek U.S. approval for managing pain due to fibromyalgia.

Lilly's biggest product, the antipsychotic Zyprexa, turned in a 9% sales gain to $1.21 billion, thanks to a 14% rise in foreign markets. U.S. sales of $563.5 million rose 4% as higher prices offset lower demand. For the year, Lilly expects "modest growth" in a drug that now accounts for 26% of corporate revenue.

The company reported sales gains of its key insulin products, Humalog, up 12% to $358.4 million, and Humulin, up 10% to $242.8 million, thanks to higher prices in the U.S., greater volume in foreign markets and favorable foreign-exchange rates.

The multiple-use cancer drug Gemzar posted a 15% gain to $395.6 million, while Alimta, for advanced lung cancer, gained 35% to $207.1 million.