Valeant, the Canadian drugmaker that has lost almost two-thirds of its value over the past year, raised full year guidance as it announced first-quarter revenues at the bottom end of analysts’ expectations.

The group posted an 11 per cent decline in revenues to the end of March compared to the same three months a year earlier, from $2.37bn to $2.1bn. Net income for the quarter swung into positive territory at $628m, but the number was flattered by a one-off tax benefit of $908m from a restructuring.

It blamed lower sales volumes in two of its major segments for the drop in revenues, as well as “a loss of exclusivity for a number of products and challenging market dynamics”. It also said revenues were hit by exchange rates, business sales, discontinued lines and a “modest decrease” in average prices achieved.

But the group said it had generated cash flow of $954m in the quarter from operations, and had made further progress on reducing its debt pile by $1.3bn in the quarter, down by $3.6bn since the end of last year to $28bn.

Full year adjusted EBITDA is now expected to be between $3.6bn and $3.75bn, up from a range of $3.55 to $3.7bn, lifted by the sale of some of its skincare brands to L’Oreal in January.

Chief executive Joseph Papa said:

Our first quarter performance demonstrates that we are delivering on our commitments. We met our internal expectations, and we are continuing to make progress on our key initiatives, focus on the turnaround of our core businesses and improve internal operating efficiencies… Our divestiture efforts and cash flow generation have led to a $3.6 billion reduction in total debt to date, since the end of the first quarter of 2016, and our successful debt refinancing provides us with a more comfortable maturity profile.

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