Shares drop after Merck backs off profit forecast

Merck & Co. shares tumbled Thursday after it stunned investors by withdrawing its oft-repeated profit forecast for 2013 and giving lower-than-expected guidance for this year. It blamed pricing pressures, troubles with a crucial experimental drug and the need to invest for the future.

The drugmaker posted a $531 million fourth-quarter net loss due to $3.9 billion in charges but beat anticipated results on strong sales growth from its key drugs and ones acquired along with Schering-Plough Corp. 15 months ago.

Lower costs, higher prices boost Kellog quarter profit

Kellogg Co.’s fourth-quarter net income climbed 7 percent despite falling volumes as the world’s biggest cereal maker lowered costs and raised prices.

It was a difficult and disappointing year for Kellogg, which struggled with intense competition, lower cereal sales and major food recalls. But there were signs that 2011 may be better for Kellogg, and its shares rose in trading Thursday.

Kellogg, which makes Frosted Flakes, Pop Tarts and other foods, is increasing its investment in new product development by 25 percent after scaling back during the recession.

Mazda takes quarter loss on weak sales, strong yen

Mazda Motor Corp. sank into the red in the October-December quarter, unable to overcome a stronger yen and lackluster sales in Japan.

The Japanese automaker said Thursday it booked a quarterly net loss of 2.67 billion yen ($32.7 million). It had net profit of 4.42 billion yen a year earlier.

Demand for cars in Japan fell sharply in the quarter after government subsidies for green car purchases expired, Mazda said. It also cited foreign exchange losses.

Poor home DVD sales push Viacom quarter profit down

Lower sales of home DVDs outweighed healthy growth in advertising revenue during Viacom Inc.’s fiscal first quarter, sending earnings down 12 percent from a year earlier for the owner of the MTV channel and Paramount Pictures movie studio.

The New York company, which is controlled by billionaire Sumner Redstone, said Thursday its net income fell to $610 million, or $1 per share, for the three months ended Dec. 31 from $694 million, or $1.14 per share, a year ago. Adjusted profit, which excludes earnings from discontinued operations, was $1.02 per share.

Revenue fell 5 percent to $3.83 billion from $4.02 billion, a drop Viacom attributed mainly to lower home entertainment sales. Higher advertising and theatrical revenue wasn’t enough to make up for the drop in DVD demand.