PARSIPPANY, N.J. (AP) — Watson Pharmaceuticals Inc. completed its $5.6 billion of Swiss competitor Actavis Group Wednesday, and the company said Thursday that it expects that profit to grow at least 30 to 40 percent in 2013.
The generic drug seller is now forecasting adjusted net income to more than double this year, to $5.85 to $5.95 per share, on revenue of $5.9 billion. That means Watson expects about 15 cents per share in additional profit and $400 million in revenue from Actavis over the last two months of the year. Watson had previously forecast net income of $5.65 to $5.85 per share and $5.5 billion in revenue in 2012. Analysts expect Watson to report $5.88 per share in net income in 2012 on $5.5 billion in revenue, according to FactSet.
Moreover, the company forecasts further growth next year, to about $7.74 to $8.33 per share, stripping out one-time items. Watson has said it will have annual revenue of about $8 billion with Actavis as part of its business.
Analysts predict income of $7.81 per share and $7.1 billion in revenue in 2013.
In the July-September quarter, Watson's net income rose 13 percent as it began selling low-cost generic versions of drugs including the blood thinner Lovenox and respiratory medication Xopenex.
Watson said its net income rose to $76.7 million, or 60 cents per share, from $68.1 million, or 54 cents per share. The company said it earned $1.35 per share if one-time items like amortization, which accounts for the declining value over the years of drugs, a benefit from a tax audit settlement and other charges are excluded. Analysts were expecting net income of $1.28 per share
Revenue grew 19 percent to $1.29 billion. Sales from the company's generic drug division, which brings in most of Watson's revenue, rose 15 percent during the quarter. Analysts expected revenue of $1.27 billion.
Shares of Watson Pharmaceuticals closed at $85.95 on Wednesday. The shares have jumped almost 50 percent since the first reports of Watson's talks with Actavis became public in March and reached an all-time high of $89.90 on Oct. 16.