Quarterly Income Flat at ICN

COSTA MESA — Shares of ICN Pharmaceuticals Inc. fell 10% Friday as the drug maker reported flat first-quarter net income and per-share earnings that fell well below Wall Street’s expectations.

ICN posted a profit of $22.3 million, or 50 cents a share, compared with $22 million, or 65 cents a share, in last year’s first quarter. Revenue in the first three months grew 15% to $159 million from $138.2 million.

Reacting to the lower earnings per share, investors sent the company’s stock price down $2.125 a share to close at $21 on the New York Stock Exchange.

Wall Street expected per-share earnings in the mid-70 cent range, said James P. Keeney, an analyst with Rodman & Renshaw/Abaco in Boston. He said the company added about 3.2 million shares of preferred stock, which can be converted to common stock, to its per-share calculations.

The accounting treatment took 9 cents a share from earnings, not enough to approach analysts’ projections.

Increasingly dependent on volatile East European markets, ICN dropped $4 million just on foreign currency exchange expenses, Keeney said. The company also had greater interest and other expenses related to its foreign acquisitions.

ICN has pursued a strategy of gaining an early foothold in emerging markets, especially in Russia and former Soviet Union satellites like Yugoslavia and Hungary. It also formed a joint venture with a Chinese company.

The company’s U.S. sales fell 28% in the first quarter to $22.3 million from $31.1 million. The company said the poor U.S. results reflect a decline in sales of Virazole, its prized drug.