Just days after rumors swirled about a possible takeover offer, global pharmaceutical giant AstraZeneca (NYSE: AZN ) reported its first-quarter results very early this morning, delivering modest top-line growth but seeing its profits shrink notably.
For the quarter, AstraZeneca delivered revenue growth of just 0.5% to $6.42 billion, however this included a greater than 2% negative effect from unfavorable currency movements. Within the U.S., revenue jumped 3%, aided by an 8% improvement in Crestor sales as well as the full recognition of its diabetes franchise having completed the purchase of its previously unowned stake from Bristol-Myers Squibb (NYSE: BMY ) in early February. Also notable were sales gains from Brilinta, Byetta, and Bydureon which improved 94%, 86%, and 196%, respectively, from the year-ago quarter.
On the flip side, AstraZeneca did note that patent expirations negatively affected revenue by roughly $150 million. This includes previous blockbuster Seroquel and Arimidex, whose revenue fell by double-digit percentages year-over-year.
Based on geographic breakdown, China, emerging markets, and the U.S. were AstraZeneca's bright spots with revenue rising 26%, 7%, and 3%, inclusive of negative currency effects, while established rest of world revenue (i.e., not the U.S. or Europe) dipped 11% and European revenue slipped 1%.
Despite delivering modest top-line growth, an 8% increase in selling, general, and administrative expenses and a 15% jump in cost of sales pressured AstraZeneca's profit for the quarter. In sum, the company reported $1.17 in core EPS, which was down 11% from the prior year in a constant exchange rate environment.
Looking ahead, AstraZeneca maintained its previously issued full-year guidance and announced in a research and development update that its pipeline now contains 104 ongoing projects, of which 90 are currently in the clinical phase of development.