Pfizer Inc. reported a surge in profit due to gains from the recently enacted tax law, and the drugmaker said it plans to pay a tax of $15 billion on overseas profits over the next eight years.
The company also said it plans to invest about $5 billion in capital projects in the U.S. over the next five years, including bolstering its manufacturing presence.
“I am pleased that the aspects of most importance to us were addressed in the new tax code,” Chief Financial Officer Frank D’Amelio said.
Pfizer said sales rose during the quarter as growth in the company’s key brands offset sales declines from generic competition. Revenue from its innovative health segment rose 6% during the fourth quarter, driven by anchor brands Eliquis and Xeljanz.
The drug company has been exploring a sale or spin off of its consumer-health business, which makes over-the-counter treatments like Advil and Chapstick, in a bid to focus on its prescription-drug business. With the deadline for potential bids looming later this week, Chief Executive Ian Read said Tuesday the company is on track to make a decision this year, which could include deciding to retain the business.
The company also provided an upbeat outlook, forecasting adjusted earnings of $2.90 to $3.00 a share on up to $55.5 billion in sales. Analysts polled by Thomson Reuters had forecast $2.78 a share on $53.88 billion in sales.
In all for the fourth quarter, the New York-based company topped views. Pfizer reported a profit of $12.27 billion, or $2.02 a share, up from $775 million, or 13 cents a share, a year earlier. The massive uptick in profit came from a $10.7 billion benefit from the revaluation of deferred tax liabilities.
On an adjusted basis, the company’s earnings grew to 62 cents from 47 cents in the comparable quarter a year ago.
Revenue edged 0.6% higher to $13.7 billion.
Analysts were looking for adjusted earnings of 56 cents on $13.68 billion in revenue.
Shares fell 2% to $38.24 during premarket trading. The stock is up nearly 25% over the past 12 months.
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