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Biotech / Medical : PFE (Pfizer) How high will it go? -- Ignore unavailable to you. Want to Upgrade?

To: hilm who wrote (5973)	10/13/1998 9:46:00 PM
From: Anthony Wong	Respond to of 9523

DJ Newswire: Pfizer Misses 3Q Earns Estimates; Dn 6% In After-Mkt Trading October 13, 1998 8:00 PM By Melanie Trottman NEW YORK (Dow Jones)--Shares of Pfizer Inc. (PFE) were off 5.9% in after-market trading as investors reacted to the company's third-quarter earnings which missed Wall Street estimates. Atter the close of the market, the pharmaceutical giant reported third-quarter earnings of 51 cents a diluted share, or $667 million, excluding what the company called unusual and nonrecurring charges of $152 million. That's a 13% increase from the 45 cents reported a year earlier, also excluding items. Analysts surveyed by First Call Corp. had expected the company to earn 57 cents a share excluding charges. Revenue rose 21% to $3.33 billion, led by a 26% increase in the world-wide pharmaceuticals group, which accounted for $2.9 billion. Excluding the impact of foreign exchange, the increase in pharmaceuticals would have been 30%. Sales of Viagra, the company's treatment for erectile dysfunction, totaled $141 million in the quarter. Most analysts said the number fell short of their expectations. Viagra sales were down from the second quarter due to the high level of wholesaler stocking in the U.S. in the second quarter and a reduction in prescription levels in the third quarter, Pfizer said. The company was sure to note that lower prescription levels had been expected. To date, sales of Viagra have reached $551 million since its U.S. introduction in April. Analysts noted that sales of the company's new antibiotic Trovan did well, contributing $41 million in U.S. sales in the quarter. Analysts Might Adjust Views Downward What surprised Wall Street was the way Pfizer handled its earnings report. The company removed all the revenue and expenses of its medical technology group businesses from the income statement for the latest and year-ago third quarters. Pfizer has sold, or has agreed to sell, each of its medical technology businesses. The financials of these businesses are reported as discontinued operations on the income statement. On top of that, the company elected to take some unusual charges, including payments made to C.D. Searle & Co. for a new anti-arthritis and pain medicine, and legal settlements. The overall result was a confusing earnings report. Several analysts said they will likely adjust their estimates downward after clarifying certain factors with the company Wednesday. Pfizer reported net income for the quarter of $1.06 a diluted share, or $1.39 billion, including a gain of 67 cents a share, or $882 million, from discontinued operations. That's compared with year-ago net income of 46 cents a diluted share, or $596 million, including a gain of 1-cent, or $14 million, from discontinued operations. The company said the income figure in the latest quarter was hurt by an "unusually low" tax rate for the same period last year, when the company lowered its estimate of its effective tax rate for the full year. On a pro-forma basis, reflecting last year's business segments and tax rate, third-quarter 1998 diluted earnings per share excluding divestiture gains and unusual and nonrecurring items would have been 56 cents a share, the company said. -Melanie Trottman 201-938-5287