A strong contribution from acquisitions helped Galen Holdings to deliver better-than-expected second-quarter results yesterday.
Shares in the Northern Irish drug-maker rose by nearly 10 per cent in London to 535p sterling after it reported a 48 per cent rise in operating profits to $34.8 million (€30.2 million) in the three months ended March.
In Dublin, the shares also advanced strongly to close 63 cents, or 9 per cent, higher at €7.50.
The company, which specialises in women's healthcare and dermatology, reported total revenues of $89.2 million in the second quarter, a 17 per cent increase on the same quarter last year. However, if turnover from the discontinued services business is stripped out, product revenue was 57 per cent ahead.
Sarafem, a drug used in the treatment of pre-menstrual disorder, which was acquired in January, proved a strong driver for the group, contributing sales of $15.4 million.
Two other products, Duricef and Moisturel, which were acquired in March last year, contributed a further $6 million.
The company's existing products also delivered strong organic growth.
Sales of its oral contraceptive Ovcon were up by 20 per cent to $13.4 million in the quarter, its acne treatment Doryx saw sales jump by 62 per cent to $17.2 million, while Estrace Cream, a hormone replacement therapy product, recorded sales growth of 34 per cent to $10.1 million.
Adjusted earnings per share rose by 59 per cent to 16.1 cents, ahead of analyst forecasts which were 14-15 cents.
The company plans to pay an interim dividend of 1.2 pence, up 20 per cent on last year's level.
Analysts described the numbers as "solid" and set about upgrading their full-year forecasts. The company remained upbeat on the outlook for the remainder of the year when the impact of the three recently acquired Pfizer products - Estrostep, Loestrin and Femhrt - will be felt.
"We're cautiously optimistic that we may have a stronger year than anticipated," chief executive Mr Roger Boissonneault said.
Galen also stands to benefit from the introduction in June of Femring, a vaginal oestrogen product designed to treat menopausal symptoms.
Galen's senior vice-president for finance and planning, Mr David Kelly, said the company's salesforce had begun placing Femring samples with doctors in the US over the past week, ahead of the product's formal launch in June.
However, he said there was no update on the progress of the regulatory process regarding a new version of Ovcon, which Galen is hoping to introduce later this year before a generic version reaches the market.
The company also faces generic threats to some of its more recently acquired products, including Sarafem, and is engaged in legal proceedings to defend its position.
Galen said that during the quarter it generated cash of $36.2 million. It had cash on hand of $50 million at the end of March, while net debt totalled $197.8 million.
