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UCB (UCBJF) posted full year 2011 adjusted earnings of $1.84 per share, sky-rocketing 143.4% from the year-ago earnings. Higher revenues and lower costs boosted earnings.


Annual revenues increased 6.0% to $4,525.9 million, driven by strong sales of Cimzia, Vimpat, Neupro and Keppra. [All growth rates are at constant currency basis]

While Cimzia (Crohn’s disease and rheumatoid arthritis) sales went up 63% in 2011, Vimpat (epilepsy) sales increased 70%. Neupro, which is marketed as a treatment for Parkinson’s disease and restless legs syndrome, posted a sales growth of 16% from the year-ago figure. Sales of Keppra, also for epilepsy treatment, increased 3%.

The sales of all three drugs – Cimzia, Vimpat and Neupro – experienced growth riding on improved patient demand. Increased penetration in the ex-US markets and less-than-expected generic competition helped drive Keppra sales.

Other Details

In 2011, gross profit went up 3%, as a result of higher sales and reduced cost of sales. Operating expenses climbed 6% during the reported period, as a result of higher marketing & selling expenses and increased research & development expenses.

Increased costs associated with expenses for the launch of new products in new markets resulted in higher marketing & selling expenses. Further, investment in late-stage pipeline and the initiation of multiple development programs led to the upside in research & development expenses.

Forecast for 2012

UCB expects 2012 adjusted earnings per share to be in the range of €1.60 to €1.70, on revenues of €3.1 billion.

The company anticipates 2012 results to be driven by the continued sales of Cimzia, Vimpat, Neupro and Keppra.

Our View

We currently have a Zacks #3 Rank (short-term Hold rating) on UCB. We expect UCB to continue posting strong results riding on Cimzia, Vimpat, Neupro and Keppra sales.

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