Valeant beats on earnings, cuts revenue forecast for the year (VRX)

Reuters

Canada's Valeant Pharmaceuticals International Inc cut its full-year revenue forecast, even as it reported a better-than-expected quarterly profit and said it expects to repay more than $5 billion in debt by February.

Since taking the helm in April 2016, Joseph Papa has been trying to rebuild the company's business and regain investor confidence after a flurry of investigations into its accounting and pricing practices.

One of Papa's biggest challenges has been to cut the company's towering debt, which ballooned to nearly $30 billion following a spate of deal-making under former CEO Mike Pearson.

The maker of Bausch + Lomb contact lenses said on Tuesday it now expects revenue of $8.70 billion to $8.90 billion for the full year, down from its previous forecast of $8.90 billion to $9.10 billion.

Last month, the drugmaker paid down $811 million of debt with proceeds from the sale of its cancer treatment unit Dendreon Pharmaceuticals, and agreed to sell its Obagi Medical Products business for $190 million. In June, Valeant agreed to sell its iNova Pharmaceuticals business for $930 million.

Valeant, which also maintained its 2017 forecast for adjusted earnings before interest, tax, depreciation and amortization, said it had long-term debt of about $28.5 billion as of June 30.

The company said it expected to pay down more than $5 billion in debt from divestiture proceeds and free cash flow before February 2018.

Excluding items, the Laval, Quebec-based company earned $1.05 per share, ahead of the average analyst estimate of 94 cents, according to Thomson Reuters I/B/E/S.

Revenue fell 7.8 percent to $2.23 billion in the second quarter ended June 30, hurt by declines in volume and pricing of its generic and neurology products.

Net loss attributable to Valeant narrowed to $38 million from $302 million, a year earlier. The decrease in net loss was mainly due to income tax gains and increase in operating income, the company said. (Reporting by Natalie Grover in Bengaluru; Editing by Saumyadeb Chakrabarty)

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