Sales Rose by Only 4% : ICN Biomedicals Says Quarterly Net Up 49%
Crediting high-profit-margin sales and lower interest expenses, ICN Biomedicals Inc. said Tuesday that net earnings for the fiscal quarter ended Feb. 28 increased 49% to $856,000 from $574,000 a year earlier.
By contrast, the subsidiary of Costa Mesa-based ICN Pharmaceuticals Inc. said that sales for its fiscal first quarter increased by only 4% to $9.6 million from $9.2 million last year.
John Giordani, ICN Pharmaceuticals’ chief financial officer, said ICN Biomedicals sold more high-margin laboratory test equipment during the quarter just ended. That, coupled with a $250,000 decrease in interest expense, enabled the company to record the strong year-to-year profit increase, he said.
First Shareholder Meeting
The earnings announcement was made at the first shareholders meeting to be held since ICN Biomedicals went public last September in a 600,000-share stock offering that raised about $3 million. Currently, about 8% of ICN Biomedicals’ outstanding stock is in public hands.
ICN Biomedicals develops and markets research chemicals and instruments for diagnostic testing in clinical laboratories.
Because ICN Biomedicals is growing rapidly, the company expects to hire approximately 750 new employees locally over the next three years, said Milan Panic, chairman of both ICN Biomedicals and its parent company. ICN Biomedicals currently has 121 workers in Orange County.
Tuesday’s meeting was described by an ICN Pharmaceuticals spokesman as a “dry run” for the annual meetings of its other affiliated companies to be held this week. Viratek Inc. shareholders will meet today, SPI Pharmaceuticals Inc. shareholders will meet on Thursday and ICN Pharmaceuticals stockholders will gather on Friday.
All three companies have been hit by seesawing stock prices resulting from the wide speculation on Wall Street concerning Virazole, a potential AIDS medication developed, manufactured and sold by ICN Pharmaceuticals and its Viratek and SPI subsidiaries.
Viratek’s Price Slips
Viratek, for instance, was the nation’s hottest over-the-counter stock during 1986, increasing in price by nearly 500% to finish the year at $63 a share. But, since the beginning of this year, Viratek’s share price has slipped 21% to close Tuesday at $49.50 a share.
Similarly, ICN Pharmaceuticals shares--which are traded on the New York Stock Exchange--have gyrated wildly, sparking at least three shareholder lawsuits in the last month. During the last year, ICN Pharmaceuticals has traded for as high as $34 a share and for as low as $10.25 a share. It closed Tuesday at $20 a share.
ICN Biomedicals shares have about doubled since going public at $6 a share. In over-the-counter trading Tuesday, ICN Biomedicals shares closed at $12.50, up $1.25 for the day.
