Revenue Drops at Forest, Mylan

But both drug companies affirm their profit forecasts.
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Drug companies

Forest Laboratories

(FRX)

and

Mylan Laboratories

(MYL) - Get Report

posted declines in revenue for their latest quarters, but both companies affirmed their guidance for their full fiscal years.

Forest said fiscal first-quarter earnings were $216.6 million, or 62 cents a share, compared with $229.9 million, or 60 cents a share, in the year-ago period. Though net income fell, earnings per share rose because the company reported about 348 million shares outstanding on a diluted basis in the latest quarter, down from almost 381 million last year.

Excluding a one-time tax reversal, the company earned 52 cents in the first quarter. Net revenue fell 10% to $711.8 million from $792.8 million.

Sales in the quarter included $461 million for Lexapro. Forest said Namenda recorded sales of $114.7 million during the quarter. The year-ago period included sales of $261 million for branded Celexa, compared with branded and generic sales of the product of $4.2 million in the latest quarter.

Forest continues to expect earnings for the fiscal year ending March 31, 2006, of about $2.30 a share. Analysts surveyed by Thomson First Call were looking for earnings of 51 cents a share and revenue of $719.4 million for the first quarter. The consensus profit estimate for the fiscal year is $2.31.

As for Mylan, the company reported adjusted earnings of 26 cents a share and GAAP earnings of 16 cents a share for the fiscal first quarter. Earlier this month, Mylan said adjusted earnings would be 24 cents to 26 cents a share and GAAP earnings would be 14 cents to 16 cents.

Net revenue for the quarter fell to $323.4 million from $339 million in the prior-year period. Net earnings for the three-month period totaled $42.9 million, vs. $82 million a year ago.

For fiscal 2006, the company reaffirmed its adjusted diluted earnings guidance of 92 cents to $1.15 a share. For fiscal 2007, Mylan still expects adjusted earnings of $1.20 to $1.74.

On average, analysts were expecting earnings of 20 cents a share and revenue of $314.3 million in the quarter. Wall Street is projecting a profit of 94 cents a share in Mylan's fiscal 2006 and $1.23 a share for fiscal 2007.

On Monday, Mylan investor and shareholder activist Carl Icahn

said he had tendered his shares in the company's $1 billion stock buyback. However, he left open the possibility that he might still mount a proxy fight against the company's management. Mylan expects to pay $19.50 each for nearly 51.3 million shares tendered by investors, which represents about 19% of its common shares.