1990 Earnings Drop for Bergen Brunswig Corp. : Pharmaceuticals: Competition in the company’s home-video sideline is given as one reason for the 3% decline.

Citing heightened competition in its home-video distribution business, Bergen Brunswig Corp. said its earnings last year dipped 3% to $64.1 million from $66.1 million the prior year.

“The (video) market is starting to mature and it’s probably approaching the point of saturation,” said Jack Fay, vice president and corporate secretary.

The company, whose principal business is pharmaceutical distribution, reported revenue for its fiscal 1991 year ended Aug. 31 of $4.8 billion, up 9% from $4.4 billion the year before.

Per-share earnings were $1.44, compared to $1.47 last year. The figures for 1990 included a one-time gain of $3.5 million, reflecting early repayment of debt.

Sales of videos were flat last year and profits were lower due to increased competition, Fay said. The company does not release specific sales figures for its video business.

Bergen Brunswig has a 20% share of the U.S. home-video market and is the nation’s largest video distributor. Last year, the movies that the company distributed to rental stores for the studios included the hits “Home Alone” and “Dances With Wolves.”

The Orange company owns 79% of Commtron Corp., a Des Moines, Iowa, distributor of videos, VCRs, small televisions and other related electronic items. Commtron’s revenue dropped 4.7% to $528 million last year from $554 million the prior year. Earnings fell to $8.8 million from $11 million.

The company attributed the decrease in part to Commtron’s decision to eliminate marginal consumer electronics products--chiefly cellular telephones--cutting consumer-electronics revenue by $28 million, Fay said.

Still, the company’s 1991 results were at the low end of analysts’ expectations.

“Bergen Brunswig continues to struggle relative to some other drug wholesalers who have been reporting recently,” said Donald Spindel, an analyst with A.G. Edwards & Sons, a St. Louis investment firm.

He said Bergen Brunswig has the bad fortune to have its fiscal year end in August, so that its figures included unusually low drug prices in July. Spindel noted that the company’s publicly held competitors concluded their fiscal years in December or March.

Most pharmaceutical wholesalers see their biggest price increases in July, Fay said, but this year those increases were upset by a new law that requires drug companies to sell Medicaid prescriptions more cheaply. In the past, the government has paid higher prices than hospitals and other institutions.

“In the past 12 months,” Spindel said, “drug-price increases from manufacturers have been more erratic than in the last five to 10 years.”

Bergen Brunswig’s Performance

For its fiscal year ended Aug. 31, Bergen Brunswig posted earnings of $64.1 million, down 3% from $66 million a year earlier. Revenue increased 9% to $4.8 billion from $4.4 billion.

Figures are in millions, except per-share data.

4th Qtr 4th Qtr 12 Months 12 Months 1991 1990 1991 1990 Revenue $1,252.3 $1,124.6 $4,838.3 $4,442.3 Net income (loss) $12.9 $14.5 $64.1 $66.0 Per share (loss) $0.31 $0.33 $1.44 $1.47

Source: Bergen Brunswig Corp.