Allergan expands buyback to $15 billion, sets first quarterly dividend

[November 02, 2016]  (Reuters) - Allergan Plc on Wednesday expanded its share buyback program by $5 billion to $15 billion and set its first-ever quarterly dividend, cushioning the impact of lower-than-expected quarterly revenue and lifting its shares.

Shares of the Botox-maker were up 1.1 percent at $211 in premarket trading.

The company's net revenue rose 4.4 percent in the third quarter ended Sept. 30 on higher demand for its key products, but missed analysts' estimate due to tumbling sales of its ulcerative colitis drug Asacol and Namenda Alzheimer's treatment. Both drugs have lost patent protection.

The drugmaker said it was initiating a regular quarterly cash dividend of 70 cents per share. The dividend is payable in the first quarter of 2017.

The company was created when Dublin-based Actavis bought the Botox maker in March 2015, snatching it from hostile bidder Valeant Pharmaceuticals Inc <VRX.TO>, and taking on the Allergan name.

Allergan Chief Executive Brent Saunders has orchestrated a string of smaller acquisitions since the company's planned $160-billion merger with Pfizer Inc <PFE.N> collapsed in April, due to new U.S. tax regulations.

In May, Allergan announced it would buy back up to $10 billion in stock, and on Wednesday said it had repurchased $5 billion of shares ahead of schedule.

Allergan in August agreed to sell the Actavis generics business to Teva Pharmaceuticals Industries Ltd <TEVA.TA> <TEVA.N> for $40.5 billion. Soon after, the company also sold to Teva its Anda drug distribution business for $500 million.

Net revenue of $3.62 billion in the third quarter missed the average analyst estimate of $3.68 billion, according to Thomson Reuters I/B/E/S.

The Allergan logo is seen in this photo illustration November 23, 2015. REUTERS/Thomas White/Illustration/File Photo

Net loss from continuing operations, net of tax, narrowed to $380.1 million, or $1.15 per share, from $875 million, or $2.40 per share, a year earlier.

Excluding special items, the company earned $3.32 per share.

The company also cut its adjusted full-year net revenue forecast for continuing operations to $14.45 billion-$14.65 billion from $14.65 billion-$14.90 billion.

Allergan also slashed its full-year adjusted profit to a range of 13.30-$13.50 per share from a previous range of $13.75- $14.20.

Up to Tuesday's close, Allergan's stock had fallen 33 percent this year.

(Reporting by Natalie Grover in Bengaluru; Editing by Sriraj Kalluvila)

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