Generic Drugmaker Teva Says Profit Will Continue to Drop in 2018
Israel’s Teva reports a $17-billion goodwill impairment citing the decline of the U.S. generic market
Posting the first financial reports since took over as CEO last year, Teva Pharmaceutical Industries Ltd. reported on Thursday a drop in earnings and revenues for the last quarter of 2017, writing off a goodwill impairment of $17 billion and forecasting weaker results than analysts were estimating.
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Heavily indebted Teva said it expects its income in 2018 to range from $18.3 billion to $18.8 billion, a 17.5% decrease from 2017’s income of $22.4 billion. The company also forecast earnings per share of $2.25 to $2.5 compared to $4.01 in 2017.The company explained the goodwill impairment by pointing to the ongoing slump the U.S. generic drugs market. Teva’s revenue in the fourth quarter fell 16% to $5.5 billion compared to 2016. Market analysts were expecting $5.28 billion. Earnings per share were 93 cents compared 1.38 cents in the same quarter the previous year. “2017 was a challenging year for Teva,” Mr. Schultz said in a statement. “By improving our financial profile through stabilization of our operating profit and cash flow, we will be better positioned to continue serving patients worldwide.”