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Amgen (AMGN) Gains After Better-Than-Expected Q1

 April 24, 2012 05:14 PM

Amgen Inc. (NASDAQ:AMGN), a biotechnology medicines company, reported a 5% increase in first quarter earnings, reflecting broad strength across the portfolio and a 8% growth in product sales. Adjusted earnings and revenue exceeded Street's expectations, sending its shares up 0.42% in aftermarket.

Earnings for the first quarter were $1.18 billion or $1.48 per share, up from $1.13 billion or $1.25 per share last year. Adjusted earnings rose to $1.29 billion or $1.61 per share from $1.26 billion or $1.34 per share.

Revenue increased 9% to $4.048 billion. Analysts had expected a profit of $1.45 per share on revenue of $3.93 billion.

[Related -Amgen, Inc. (NASDAQ:AMGN): What Will Drive Amgen This Year?]

U.S. product sales increased 8% to $3.0 billion, while International product sales rose 8% to $904 million. The impact of foreign exchange on international product sales for the first quarter of 2012 was not material.

Research & Development (R&D) expenses increased 3% to $723 million, due to higher costs associated with supporting later-stage clinical programs including AMG 145, AMG 785 and talimogene laherparepvec. This increase was offset partially by reduced expenses in Discovery Research and Translational Sciences.

Capital expenditures for the first quarter were $129 million, up from $100 million last year.

AMG 145 is a fully human monoclonal antibody that inhibits proprotein convertase subtilisin/kexin type 9 (PCSK9), a protein that reduces the liver's ability to remove LDL-C from the blood causing bad cholesterol to increase. AMG 785 is being developed to treat postmenopausal osteoporosis.

[Related -Amgen, Inc. (AMGN) Q3 Earnings Preview: Pipeline In Focus]

Looking ahead into the fiscal 2012, the company continues to anticipate revenue of $16.1 billion to $16.5 billion, and adjusted earnings of $5.90 to $6.15 per share, while Street predicts profit of $6.05 per share on revenue of $16.23 billion. The adjusted earnings excludes certain expenses related to acquisitions and cost-savings initiatives, non-cash interest expense associated with convertible notes and certain other items.

With respect to other guidance, Amgen still expects adjusted tax rate for 2012 to be in the range of 14% to 15%. Excluding the Puerto Rico excise tax, Amgen still projects adjusted tax rate for 2012 of 19% to 20%. The company still expects 2012 capital expenditures to be about $700 million.

AMGN closed Tuesday's regular trading up 0.50% at $68.63. The stock has been trading between $47.66 and $70.00 for the past 52 weeks.

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