Pfizer Inc reported higher quarterly earnings, as higher sales of animal health and nutritional products that the company aims to divest helped offset falling sales of its core pharmaceuticals business. The world's biggest drugmaker, whose shares slipped 1.3 percent in pre-market trading, said on Tuesday that it earned $2.61 billion, or 33 cents per share. That compared with $2.48 billion, or 31 cents per share, in the year-earlier second quarter.
Excluding special items, Pfizer earned 60 cents per share. Analysts on average expected 59 cents, according to Thomson Reuters I/B/E/S. Results were helped by a lower effective tax rate of 29 percent, from 32 percent a year ago. Global revenue fell 1 percent to $16.98 billion, matching Wall Street expectations, but would have fallen 5 percent if not for the weaker dollar, which boosts sales in overseas markets.
Sales of prescription drugs fell 3 percent to $14.64 billion, as Pfizer's Lipitor cholesterol fighter faced competition overseas from cheaper generics. Its world-wide sales fell 8 percent to $2.59 billion. The bigger test for the world's top-selling medicine comes in November, when $10-billion-a-year Lipitor faces an onslaught of cheaper US generics.
For the first time, Pfizer's animal health products crossed the $1 billion mark, with sales jumping 18 percent to $1.06 billion - bolstered by the company's recent acquisition of King Pharmaceuticals and its Alpharma brands. Sales of consumer healthcare products, including Pfizer's Advil decongestant and Robitussen cough medicne acquired through its purchase in 2009 of Wyeth, rose 6 percent to $721 million. Revenue from nutritional products rose 4 percent to $493 million.
Even as the animal health products and nutritional brands propped up second-quarter results, Pfizer is considering divesting both units in order to reward shareholders and focus on its pharmaceutical business. The company last month it might sell or spin off the two units, whose combined value could exceed $16 billion. Pfizer expects to complete any transactions in 12 to 24 months, but said it does not expect to make any further announcements about the businesses until next year.
The company said on Monday it had completed the sale of its Capsugel business, the world's biggest maker of hard capsules, to private equity firm KKR & Co for almost $2.4 billion in cash. Pfizer reaffirmed its 2011 profit forecast of $2.16 to $2.26 per share, excluding special items. Thanks to huge planned cuts in its research budget, Pfizer predicted earnings in 2012 of $2.25 to $2.35 per share - reflecting stable or improved earnings the first full year Lipitor faces US generics.
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