Drug giant Merck & Co. Inc. (NYSE: MRK) reported fourth-quarter and full-year 2013 results before markets opened Wednesday morning. The company reported quarterly adjusted diluted earnings per share (EPS) of $0.88 and revenues of $11.32 billion. In the same period a year ago, Merck reported EPS of $0.83 on revenues of $11.74 billion. Fourth-quarter results also compare to the Thomson Reuters consensus estimates for $0.88 EPS and $11.36 billion in revenues.

For the full year, Merck posted EPS of $3.49 on revenues of $44.03 billion, compared with year-ago EPS of $3.82 and revenues of $47.27 billion. The consensus estimate called for EPS of $3.50 on revenues of $44.15 billion.

For the quarter, Merck took a charge of $565 million related to restructuring, bringing its annual restructuring charges to $1.71 billion. The company took an $870 million charge in the third quarter after saying it would fire 8,500 workers in addition to the 7,500 it had already planned.

Gross margin fell from 64.6% in the year-ago quarter to 59.3%, primarily due to restructuring charges and acquisition costs. On a non-GAAP basis, the decline in gross margin reflects the impacts of lost patent protection, product mix and pricing pressure in mature markets.

Merck now forecasts full-year 2014 adjusted EPS in a range of $3.35 to $3.53. The midpoint of that range, $3.44, is below the consensus EPS estimate of $3.48 for this year. Full-year revenues are forecast at $42.4 billion to $42.2 billion, while the current consensus estimate is $43.35 billion.

The company’s CEO said:

In 2013 we took decisive action to sharpen our focus, reduce our cost structure and advance our innovative research and development. This year we are excited about the potential of our near- and long-term pipeline, poised for long-term growth and committed to providing continued value to patients, customers and our shareholders.

Pharmaceutical sales overall were down 3% for the quarter and 8% for the year, including a 3% negative impact for currency translation effects. The company’s revenues from its animal health group were also down 3% for the quarter and 1% for the year, including the negative 2% impact due to currency translation. Consumer care revenues were down 1% for the quarter and 3% for the year.

Merck’s was one of only four DJIA stocks to post a gain in January. The share price rose 27% in 2013 and was up another 5.8% in January. The company also revealed that it will collaborate with Amgen Inc. (NASDAQ: AMGN), Incyte Corp. (NASDAQ: INCY) and Pfizer Inc. (NYSE: PFE) in clinical evaluations of its MK-3475 cancer drug.

Shares of Merck’s stock traded about 2.8% higher in Monday’s premarket to $54.65, which would be a new 52-week high if it holds. The 52-week low is $40.02. Thomson Reuters had a consensus analyst price target of around $54.80 before this report.

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