Schering-Plough second-quarter net income rises to $237 million, or 16 cents per share

By Lisa Kerner

Charlotte, N.C., July 24 - Schering-Plough Corp. reported net income available to common shareholders of $237 million, or 16 cents per share on a GAAP basis, for the second quarter of 2006, up from the reported loss of $70 million, or 5 cents per share on a GAAP basis, for second-quarter 2005.

GAAP net sales for the 2006 second quarter of $2.8 billion were up 11% from the 2005 second quarter.

Including an adjustment of an assumed 50% of global cholesterol joint venture net sales, the company's adjusted net sales for the 2006 second quarter would have totaled $3.3 billion, an 18% increase, compared to $2.8 billion on a similar adjusted basis in the 2005 second quarter.

Schering-Plough's gross margin for the second quarter of 2006 was 64.4%, compared with 65.8% in the 2005 period. The gross margin in the 2006 quarter was negatively impacted by $58 million of costs associated with streamlining the company's manufacturing operations.

Highlights for the 2006 second quarter and more recently include streamlining the global supply chain, including phasing out manufacturing operations in Manati, Puerto Rico, and workforce reductions, and establishing a wholly owned country operation in Brazil.

The company said key sales growth drivers for the quarter included Remicade, Nasonex and Peg-Intron as well as Schering-Plough's franchise through its joint venture with Merck.

"Schering-Plough is executing on its six- to eight-year strategic plan that we laid out in 2003," chairman and chief executive officer Fred Hassan said in a company news release.

"Our turnaround is well under way."

Schering-Plough is a global health care company based in Kenilworth, N.J.

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