Valeant shares lose more than half their value

MONTREAL — Valeant Pharmaceuticals, once one of Canada’s most valuable companies, saw its stock plunge Tuesday to its lowest level in more than three years after reporting fourth-quarter earnings below expectations and lowering its outlook for 2016.

Shares in the Quebec-based drug giant lost a touch more than 50 per cent of their value, closing at $45.15 Cdn on the Toronto Stock Exchange. At its peak last August, Valeant stock was worth nearly $350 Cdn.

“Our business is not operating on all cylinders,” CEO Michael Pearson said in a conference call. “But we and I are committed to get it back on track.”

The company said it had a net loss of $336.4 million US in the final quarter of 2015 — rather than a net profit of $462.6 million US as analysts had expected — largely due to costs associated with restructuring and acquisitions.

After adjustments, Valeant says it earned $875.7 million US or $2.50 per share. Analysts had estimated adjusted earnings of $942.8 million US, or $2.61 per share, according to Thomson Reuters.

Valeant’s revenue for the fourth quarter was just under $2.8 billion US, which was in line with analyst estimates, but the company reduced its previous sales and adjusted earnings estimates for the first quarter of 2016.

“In a sense, we’ve botched a quarter,” Pearson said.

There could be more bad news on the horizon. It delayed filing its 2015 annual report with regulators, while it investigates its former relationship with Philidor. Questions arose last October after a report revealed Valeant’s previously undisclosed relationship with the Pennsylvania mail-order pharmacy. Valeant has since launched an internal investigation into the matter.