Merck’s (MRK) shares climbed over 3% in morning trade on Friday after the company topped revenue and earnings expectations for the fourth quarter of 2018. Worldwide sales grew 5% to $11 billion from the prior-year quarter. Foreign exchange negatively impacted sales by 3%.
On a GAAP basis, the company reported a net income of $1.8 billion or $0.69 per share during the quarter compared to a net loss of $1.04 billion or $0.39 per share in the year-ago period. Last year’s earnings results included a provisional charge related to US tax legislation. On an adjusted basis, net income grew 3% to $2.7 billion while EPS rose 6% to $1.04.
During the quarter, sales in the Pharmaceutical segment grew 6% helped by strength in oncology and vaccines. Sales were negatively impacted by weakness in virology, loss of market exclusivity for certain products and foreign exchange.
Also see: Merck Q4 2018 Earnings Conference Call Transcript
While higher sales of KEYTRUDA and GARDASIL helped fuel growth in oncology and vaccines, a significant drop in ZEPATIER sales due to tough competition and declining patient volumes hurt virology sales.
In Animal Health, sales increased 6%, driven by inline and newly launched products. The growth reflects higher sales of companion animal and livestock products.
The company expects full-year 2019 revenue to be $43.2 billion to $44.7 billion, including a negative impact from foreign exchange of around 1%. GAAP EPS is expected to be $3.97 to $4.12 while adjusted EPS is expected to be $4.57 to $4.72.