Pfizer beats sales, profit forecasts

January 28, 2014

(Reuters) - Pfizer Inc reported better than expected fourth-quarter results, helped by higher sales of drugs for cancer, nerve pain and arthritis, and the company forecast 2014 earnings in line with Wall Street estimates.

The biggest U.S. drugmaker on Tuesday said it earned $2.57 billion, or 40 cents per share, in the fourth quarter. That compared with $6.32 billion, or 86 cents per share, in the year-earlier quarter, when the company recorded a gain from selling its nutritional products business to Swiss food group Nestle SA .

Excluding special items, Pfizer earned 56 cents per share. Analysts, on average, expected 52 cents per share, according to Thomson Reuters I/B/E/S.

JP Morgan analyst Chris Schott said quarterly results were "solid" and driven by unexpectedly strong sales and lower than expected expenses.

Schott said investors remain focused mainly on the company's pipeline of experimental drugs, including a breast cancer treatment called palbociclib and studies to determine whether Pfizer's blockbuster Prevnar vaccine against pneumococcal bacteria can prevent pneumonia in adults age 65 and older.

"We believe Pfizer shares could see meaningful upside in the event of positive data for palbociclib," Schott said in a research note. Some analysts expect the drug to garner annual sales of more than $3 billion if ongoing trials succeed, and it is approved.

Pfizer's effective tax rate fell 2 percentage points to 27.7 percent in the quarter, largely related to audit settlements with overseas governments, bolstering quarterly results.

Global company sales fell 2 percent to $13.56 billion, hurt by competition from cheaper generic forms of its medicines. But they topped Wall Street forecasts of $13.35 billion.

Pfizer said it expects full year earnings in 2014, excluding special items, of $2.20 to $2.30 per share. That is roughly in line with Wall Street expectations of $2.28 per share, and assumes that Pfizer buys back $5 billion worth of its common stock during the year.

Sales of Lyrica, a Pfizer treatment for nerve pain that is its biggest product, rose 11 percent in the fourth quarter to $1.26 billion, while sales of Prevnar rose 3 percent to $1.1 billion. Sales of Enbrel, a treatment for psoriasis and arthritis, rose 5 percent to $1 billion. And Celebrex, used to treat pain and arthritis, rose 6 percent to $798 million. But sales of impotence treatment Viagra fell 14 percent to $476 million, hurt by sharply lower sales in overseas markets.

Company shares traded at $30.15, up from their closing price of $29.66 Monday on the New York Stock Exchange.

(Reporting by Ransdell Pierson; Editing by Sofina Mirza-Reid)