West Pharmaceuticals 1Q Inline With Estimates

Despite a 42% drop in earnings, non-GAAPearnings per share were inline with the most recent estimate for the first quarter.
Author:
Publish date:

Once these most recent quarterly results are finalized, they will be run through TheStreet.com Ratings' model and our ratings will be adjusted accordingly. To keep up to date on all of our ratings, visit TheStreet.com Ratings Screener.

On April 30, 2009,

West Pharmaceutical Services

(WST) - Get Report

reported that its earnings dropped 41.2% during Q1 FY09. Net income attributable to the shareholders for the quarter declined to $15.40 million or $0.46 per share from $26.20 million or $0.76 per share in Q1 FY08. On a non-GAAP basis, earnings of $0.42 per share were inline with the most recent consensus estimate.

Revenue declined 10.5% to $242.40 million from $270.70 million a year ago, due to adverse currency translation. The decrease in sales was also due to the absence of sales of the discontinued Exubera inhalable insulin device and a disposable medical device component that the company ceased producing. Segment-wise, revenue from the Pharmaceutical Systems segment slipped 11.7% to $183.20 million from $207.50 million. Sales of Safety and Administration Systems and Devices declined as a result of a customer-driven delay, while Disposable Device Component sales were approximately 5.3% lower on a constant currency basis. The Tech Group's revenue declined 6.2% to $62.30 million from $66.40 million.

Cost of goods sold fell 7.5% to $173.10 million from $187.20 million. Research and development expenses dropped 20.4% to $4.30 million from $5.40 million. However, selling, general, and administrative expenses spiked 7.0% to $42.90 million from $40.10 million.

WST approved Q2 FY09 cash dividend of $0.15 per share payable on May 6, 2009. The company received U.S. Food and Drug Administration (FDA) clearance for its passive safety needle device for marketing in the U.S. The device will be marketed as NovaGuard.

Looking forward to FY09, West Pharmaceutical Services Inc. expects consolidated sales in the range of $1.00 billion to $1.02 billion with adjusted earnings in the range of $2.05 to $2.18 per share.