Teva Profit Outlook Edges Up With Cost-Cutting Plan on Track

(Bloomberg) -- Teva Pharmaceutical Industries Ltd. raised the bottom end of its earnings and sales forecasts as Chief Executive Officer Kare Schultz’s cost-cutting plan remained on target.

• Adjusted earnings for the year will be $2.30 a share to $2.50, the Israeli drugmaker said. It had previously seen a minimum of $2.20 a share.
• Teva has nearly reached its $3 billion cost-reduction goal for the year.

Key Insights

• For most investors, Teva’s earnings are a sideshow to their main concern -- the scope of the company’s liability in the U.S. opioid addiction epidemic. Analysts are likely to pepper management with requests for detail on their upcoming call.
• Sales of migraine treatment Ajovy missed analysts’ estimates. Schultz has said that the drug will one day help replace the revenue from aging MS drug Copaxone, whose blockbuster sales have been eroded by cheaper competition. Its quarterly sales beat estimates.
• Total debt fell to $26.9 billion. Schultz’s signature initiative has been slashing expenses and paying back debt.
• Teva appointed Eli Kalif, 47, as chief financial officer. He was previously senior vice president of finance at Flex Ltd., a California-based technology design and manufacturing firm.

Market Reaction

• Teva shares rose as much as 5.8% in early trading before U.S. markets opened. The American depositary receipts have lost 47% this year.

Get More

• See more details.
• Read the statement.

To contact the reporter on this story: Yaacov Benmeleh in Tel Aviv at ybenmeleh@bloomberg.net

To contact the editors responsible for this story: Eric Pfanner at epfanner1@bloomberg.net, John Lauerman

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