Merck posts mixed fourth-quarter results as Keytruda sales skyrocket

Merck posted mixed fourth-quarter results, beating earnings expectations but falling short of revenue estimates despite skyrocketing Keytruda sales.

Here’s how the company did compared with what Wall Street expected:

  • EPS: 98 cents vs. 94 cents per share, according to Thomson Reuters
  • Revenue: $10.43 billion vs. $10.5 billion, according to Thomson Reuters

In the fourth quarter, the pharmaceutical company reported a net loss of $872 million, or 32 cents per share, compared with a net loss of $594 million, or 22 cents per share, in the year-ago quarter.

However, after stripping out special items, such as a $2.6 billion charge related to the new tax law, the company earned $2.7 billion, or 98 cents per share, above analysts’ estimates of 94 cents per share.

Merck posted revenue of $10.43 billion, up 3 percent from a year ago and below expectations of $10.5 billion. Its pharmaceuticals business grew 4 percent from the same time last year, reaching $9.3 billion in the quarter.

Sales of Keytruda, Merck’s blockbuster cancer drug, rocketed 169 percent to hit $1.3 billion, narrowly beating Street expectations of $1.27 billion, according to StreetAccount. Diabetes drugs Januvia and Janumet reached $1.52 billion, up 1 percent from the year-ago quarter and just above estimates of $1.5 billion.

For 2018, Merck forecasts adjusted earnings of $4.08 and $4.23 per share and revenue of $41.2 billion and $42.7 billion. Analysts had been expecting $4.11 per share and $41.1 billion, respectively.

Merck expects to pay about $5 billion over eight years for a one-time repatriation tax. The company plans to invest about $12 billion over five years in capital projects, including approximately $8 billion in the U.S.

It plans to provide a “one-time, long-term incentive award” for eligible non-executive employees in the second quarter of this year. Further details regarding weren’t immediately known.

Merck also made a contribution to its foundation in the fourth quarter.

Shares of Merck rose about 0.4 percent in premarket trading. They’ve shed nearly 7 percent over the past year.

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