Sydney-based Sirtex said it expects earnings before interest, taxes, depreciation and amortization to be down -12% on a constant-currency basis compared with fiscal 2016 for the year ending June 30, 2017. The company pegged the expected shortfall to lower-than-forecast dose sales in the Americas and EMEA regions for its SIR-Sphere microspheres, which are used to treat liver cancer.
Dose sales growth during the 1st half of the year was 4% to 6%, compared with 15.7% during H1 2016, pointing to EBITDA declines of -16% to -9% or A$30 million to A$32 million ($22.4 million to $23.9 million). Full-year dose sales growth is pegged at 5% to 11%, compared with 16.4% during fiscal 2016, auguring for EBIDTA of A$65 million to A$74 million ($48.5 million to $55.2 million), which would be down -12% to flat compared with the last fiscal year.
“We anticipated achieving double-digit growth in the 1st half, however trading conditions have been volatile and impacted by a number of factors, including increased competition for patients with liver-directed therapies, a new drug approval in salvage metastatic colorectal cancer and restrictions in reimbursement. We have implemented a range of strategic initiatives across the regions to address the disappointing 1st half, which we anticipate will result in an improved 2nd half and full-year dose sales performances, irrespective of the results from our 3 major clinical studies that are due to report findings in the 1st half of calendar year 2017,” CEO Gilman Wong said in prepared remarks. “It is important to recognize that our SIR-Spheres Y-90 resin microspheres business represents a long-term growth opportunity, with a large contestable market and low penetration to date. Our product has industry-leading evidence of benefit for liver cancer patients, which we will continue to leverage.”
The outlook prompted investors Down Under to pare as much as 52.1% from SRX shares, to A$12.20 ($9.11), marking a 2-year low for the stock. SRX shares closed down -37.2% at A$16.00 ($11.94) apiece today.
(A$1 = $0.746549)