On Nov. 2, pharmaceutical company Cephalon (NASDAQ:CEPH) released third-quarter earnings for the period ended Sept. 30.
- Revenues and EPS were up sharply over the prior-year period.
- Sales were driven largely by strong sales of ACTIQ and the PROVIGIL tablet.
- The company launched FENTORA, which bodes well for its continued growth in coming years.
- Cephalon has a highly leveraged balance sheet with $1.6 billion in debt. This is not a huge concern, as the company can easily cover the interest expense and generates substantial free cash flow.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Avg. Est. |
Q3 2006 |
Q3 2005 |
Change | |
|---|---|---|---|---|
|
Sales |
$435 |
$482.3 |
$309.5 |
55.8% |
|
Net Profit |
-- |
$95.7 |
$29.3 |
226.3% |
|
EPS |
$1.16 |
$1.43 |
$0.50 |
186.0% |
|
Diluted Shares |
-- |
67.1 |
59.4 |
12.9% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q3 2006 |
Q3 2005 |
Change* | |
|---|---|---|---|
|
Gross Margin |
87.07% |
87.84% |
(0.77) |
|
Operating Margin |
31.44% |
15.79% |
15.65 |
|
Net Margin |
19.85% |
9.48% |
10.37 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$630.4 |
$815.6 |
(22.7%) |
|
Accounts Rec. |
$234.7 |
$160.4 |
46.3% |
|
Inventory |
$164.7 |
$119.3 |
38.1% |
|
Liabilities |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$63.5 |
$56.8 |
11.8% |
|
Long-Term Debt |
$1695.9 |
$1,696.1 |
0.1% |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
YTD 2006 |
YTD 2005 |
Change | |
|---|---|---|---|
|
Cash From Ops. |
$251.2 |
$68.4 |
267.2% |
|
Capital Expenditures |
$97.1 |
$64.0 |
51.9% |
|
Free Cash Flow |
$154.1 |
$4.5 |
3324.4% |
Find out why Fools always follow the money.
Related companies:
- Serono (NYSE:SRA)
- Shire Pharmaceuticals (NASDAQ:SHPGY)
- Salix Pharmaceuticals (NASDAQ:SLXP)
- Axcan Pharma (NASDAQ:AXCA)
Related Foolishness:
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