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Eli Lilly (LLY) Guides 2013 Above Street; Reconfirms 2012 Profit View

 January 04, 2013 08:10 AM

(By Balaseshan) Eli Lilly & Co. (NYSE: LLY) reconfirmed its fiscal 2012 earnings guidance and introduced its financial outlook for fiscal 2013 that was better than Street's view. The drugmaker expects the growth trend to continue in 2013.

"At Lilly, we continue to implement the three primary elements of our strategy to bridge our current period of patent expirations and return to sustainable growth. We have made substantial progress in recent years and expect 2013 to continue that trend," said John Lechleiter, Lilly's chairman, president and chief executive officer.

Because the enactment of the American Taxpayer Relief Act of 2012 was not completed until 2013, certain provisions of the Act benefiting the company's 2012 federal taxes, including the extension of the R&D tax credit for 2012, cannot be recognized in Eli Lilly's 2012 financial results and instead will be reflected in its 2013 results.

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For the fiscal 2012, the company reconfirmed its earnings per share (EPS) guidance in the range of $3.68 to $3.78 on a reported basis, or $3.30 to $3.40 on a non-GAAP basis, while Street predicts $3.36.

For 2013, the company expects EPS to be in the range of $4.03 to $4.18 on a reported basis, or $3.75 to $3.90 on a non-GAAP basis. The company anticipates 2013 revenue of between $22.6 billion and $23.4 billion. Street analysts predict EPS of $3.71 on revenue of $22.82 billion.

Total operating expenses in 2013 are expected to be flat to slightly decreasing compared to 2012, reflecting continued expense controls and productivity gains. Marketing, selling and administrative expenses are expected of $7.1 billion to $7.4 billion. Research and development expenses are expected in the range of $5.2 billion to $5.5 billion.

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"We remain on track to meet or exceed our minimum financial performance targets. From now through 2014, on an annual basis we still expect revenue to be at least $20 billion, net income to be at least $3 billion, and operating cash flow to be at least $4 billion," said Derica Rice, Lilly executive vice president, global services and chief financial officer.

LLY closed Thursday's regular session up 0.42% at $49.72. The stock has been trading between $38.30 and $53.99 for the past 52 weeks.

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