Merck KGaA lifts annual outlook as third-quarter profit climbs

Merck KGaA announced Thursday alongside its third-quarter financial results that it expects sales and earnings this year to be higher than previously forecast, as a result of "good operational performance" and the imminent acquisition of Sigma-Aldrich. Overall sales in the third quarter rose 6.8 percent year-over-year to 3.1 billion euros ($3.3 billion), falling just short of analyst estimates, while revenue from the healthcare division lifted 1.4 percent to 1.7 billion euros ($1.8 billion).

For specific drugs, sales of Rebif were relatively flat at 468 million euros ($502 million), topping analyst predictions of around 454 million euros ($487 million), while revenue from Erbitux declined 4 percent to 223 million euros ($239 million), below estimates of 241 million euros ($258 million). In addition, sales of Gonal-f climbed 14 percent to 167 million euros ($179 million).

"Our organic growth in all three business sectors and all regions shows that our strategy is bearing fruit. We are also well-positioned for future growth," commented CEO Karl-Ludwig Kley. Net income in the three-month period reached 364 million euros ($390 million), up from 248.8 million euros ($267 million) in the year-ago quarter.

For the full year, Merck said it now predicts sales of between 12.6 billion euros ($13.5 billion) and 12.8 billion euros ($13.7 billion), versus a previous forecast of 12.3 billion euros ($13.2 billion) to 12.5 billion euros ($13.4 billion). Meanwhile, earnings are now seen in a range of 3.58 billion euros ($3.84 billion) to 3.65 billion euros ($3.91 billion), adjusted from an earlier estimate of 3.45 billion euros ($3.7 billion) to 3.55 billion euros ($3.81 billion). The company noted that the outlook now factors in Sigma-Aldrich.

"Following the acquisition of Sigma-Aldrich, which we are ready to complete subsequent to final clearance from the European Commission, Merck will be one of the world's leading suppliers in the life science industry," Kley remarked.

Last month, Merck announced that deputy CEO Stefan Oschmann will assume the role of chief executive next year, succeeding Karl-Ludwig Kley, who will retire. The company also recently said that as part of a brand relaunch it will scrap its divisional names Merck Serono and Merck Millipore and be known as Merck outside North America. The company indicated that in the US and Canada it will continue to operate as EMD Serono in the biopharmaceutical business and as EMD Millipore in the life science business, up until the planned acquisition of Sigma-Aldrich has been completed.

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