On Nov. 7, Watson Pharmaceuticals
- Sales increased by 7.4% to $440.5 million, driven by higher product sales in the company's generic division as a result of new products launched.
- Net income decreased by 12% to $34.4 million because of increased cost of sales and lower brand product sales, which affected the margins.
- Diluted earnings per share decreased by 11.4% to $0.31 because of lower net profit.
- Free cash flow increased by 35.2% to $311.9 million as cash from operations increased by 20.9%, while capital expenditure saw a decline of 46.9%.
- The stock has a two-star rating in Motley Fool CAPS.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q3 2006 |
Q3 2005 |
Change |
|
|---|---|---|---|
|
Sales |
$440.5 |
$410.3 |
7.4% |
|
Net Profit |
$34.4 |
$39.1 |
(12.0%) |
|
EPS |
$0.31 |
$0.35 |
(11.4%) |
|
Diluted Shares |
116.4 |
118.2 |
(1.5%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q3 2006 |
Q3 2005 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
41.5% |
48.6% |
(7.2) |
|
Operating Margin |
11.2% |
15.5% |
(4.3) |
|
Net Margin |
7.8% |
9.5% |
(1.7) |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
Assets | Q3 2006 | Q3 2005 | Change |
|---|---|---|---|
Cash + ST Invest. | $906.8 | $634.6 | 42.9% |
Accounts Rec. | $264.3 | $290.6 | (9.1%) |
Inventory | $318.2 | $271.7 | 17.1% |
Q3 2006 | Q3 2005 | Change | |
|---|---|---|---|
Accounts Payable | N/A | $194.4 | N/A |
Long-Term Debt | $574.1 | $587.9 | (2.3%) |
Learn the ways of the balance sheet.
Cash Flow Highlights
YTD 2006 | YTD 2005 | Change | |
|---|---|---|---|
Cash From Ops. | $337.8 | $279.5 | 20.9% |
Capital Expenditures | $25.9 | $48.8 | (46.9%) |
Free Cash Flow | $311.9 | $230.6 | 35.2% |
Find out why Fools always follow the money.
Related Companies:
- Par Pharmaceutical
(NYSE:PRX) - Barr Pharmaceuticals
(NYSE:BRL) - Dr. Reddy's Laboratories
(NYSE:RDY)
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