Canadian drugmaker Valeant’s share price plunged 45 percent to $38 in morning trading in NY on Tuesday after the company lowered its forecast for 2016 financial results. “He caused himself much more damage pounding the table” in support of Valeant and its management in recent months.
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J. Michael Pearson, CEO, commented: The challenges of the past few months are not yet behind us and our goal for 2016 is to better balance our priorities across all of our constituencies – physicians, patients, employees, payors, debt holders and shareholders. The Company is engaged in developing manufacturing and marketing a range of branded generic and branded generic pharmaceuticals over-the-counter (OTC) products and medical devices (contact lenses intraocular lenses ophthalmic surgical equipment and aesthetics devices) which are marketed directly or indirectly in over 100 countries. Breton Hill Capital Ltd. now owns 10,122 shares of the specialty pharmaceutical company’s stock worth $1,029,000 after buying an additional 4,285 shares during the last quarter.
The company, the target of US investigations into its business and accounting practices, reiterated that it would put off filing its annual report with USA regulators but for the first time raised the specter of a default.
No matter how Valeant Pharmaceuticals International Inc. tries to win investors favor but its situation gets worse. The company added it would restate 2014 and 2015 financial statements.
If Valeant misses Tuesday’s deadline bondholders could file a notice of default on the grounds the company has failed to meet reporting requirements.
“We have to earn back the credibility”. Revenue is pencilled in within the range of $11 billion to $11.2 billion, in comparison to $12.5 billion to $12.7 billion which was previously stated.
Analysts had estimated a net profit of US$462.6 million and adjusted earnings of US$942.8 million, or $2.61 per share, according to Thomson Reuters. The company reported weaker-than-expected quarterly earnings, slashed its 2016 guidance, and issued a warning about a possible default. Valeant also said it had incurred $51.3 million of wind-down costs related to Philidor, and it recorded a $79 million charge for writing down Philidor’s intangible assets. Valeant faces an investigation by the Securities and Exchange Commission, which has requested information about Valeant’s now-terminated relationship with Philidor. Valeant has delayed the 10-K report pending a review of its financial reporting and internal controls.
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Valeant’s Q4 earnings per share (EPS) came in at US$2.50, which was US$0.11 below consensus estimates. If those debtors chose to declare the company in default on its debt, which totals about $30 billion, Valeant could be forced to make repayments faster and see limits on future borrowing.
