NEW YORK (AP) — Valeant Pharmaceuticals reported a wider loss and a dip in revenue during the second quarter, but shares jumped Tuesday after the beleaguered company stuck by its outlook and said it was undergoing a restructuring to return itself to normalcy.
Valeant is dealing with three federal probes into its accounting and business practices and insurers who want relief from higher drug prices put into place for reasons now under scrutiny. The company has come under a harsh spotlight after buying older medicines with limited competition and then jacking up the prices, with no changes or improvements to the drugs.
The CEO that engineered earlier changes at Valeant has stepped down and on Tuesday, as the company distances itself from those earlier policies, its losses widened to $302.3 million, or 88 cents per share, from $53 million, or 15 cents per share, a year prior. Earnings, adjusted for one-time gains and costs, came to $1.40 per share.
Revenue tumbled 11.4 percent to $2.42 billion in the period.
Both results fell short of Wall Street expectations. Analysts that follow the company had expected per-share earnings of $1.61, and revenue of $2.59 billion, according to s survey by Zacks Investment Research.
Despite a weak quarter, Valeant stuck to earlier projections of annual full-year earnings in the range of $6.60 to $7 per share, with revenue in the range of $9.9 billion to $10.1 billion.
That eased some concerns for investors, who have seen the value of the shares they hold evaporate over the past year. Shares jumped almost 8 percent to $24.14 before the opening bell.
One year ago, shares cost about $264.
Valeant Pharmaceuticals International Inc., based in Laval, Quebec, said it is taking steps to streamline its portfolio of products and has agreed to sell rights to several drugs.
On Tuesday, Pearson's successor, CEO Joseph Papa, said that the company would be taking a "new strategic direction."
No details about that direction were released, but anything that brings Valeant closer to a more typical pharmaceutical concern would be a relief to embattled investors.
Although it will take time to implement and execute our turnaround plan, I am confident that we will show progress in the coming quarters," Papa said in a company statement.
The company on Monday announced additional changes in its leadership, executives who will report directly to Papa.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on VRX at http://www.zacks.com/ap/VRX
Keywords: Valeant Pharmaceuticals, Earnings Report