Bergen Brunswig Reports 13% Growth in Revenue for Second Quarter

Bergen Brunswig Corp. said Monday that sales and earnings for its second quarter ended March 31 were up substantially from the comparable period last year.

The Orange-based supplier of pharmaceuticals to hospitals and managed-care facilities reported its earnings rose 23% to $17.9 million, or 45 cents a share, on a 13% growth in revenue to $2.1 billion. Earnings growth was in line with analysts’ estimates.

The company’s revenue got a boost from several recently signed customer contracts, said Neil F. Dimick, its chief financial officer. Dimick noted that the company recently extended its long-term supply contracts with Columbia/HCA Healthcare Corp., the giant Louisville health-care provider, and Pharmacy Corp. of America, the Longmont, Colo.-based pharmaceutical unit of Beverly Enterprises Inc. It also signed deals with Safeway Inc., the large Oakland-based food and drug retailer, and VHA Inc., the large Irving, Tex.-based network of nonprofit health-care organizations.

As Bergen Brunswig increases its business with such large-volume buyers, it expects to retain its operating margin by holding down expenses, Dimick added.

Though price pressures on drug sales throughout the industry dampened the company’s gross margin during the quarter, reductions in its distribution, sales and administrative expenses enabled it to report an improvement to 1.84% in its operating profit margin, the company said. The margin for the past period was 1.74%.

The company’s earnings for the six months ended March 31 were up 26% to $31.4 million, or 79 cents a share, from the comparable period, while revenue advanced 11% to $4.1 billion. Earnings for the second quarter and six-month period last year reflected an $800,000 after-tax charge stemming from earthquake damage to the company’s distribution center in Valencia.