David Brennan, the chief executive of AstraZeneca, was upbeat yesterday as he unveiled a 27 per cent jump in pre-tax profit for the third quarter — better than expected — and increased his forecast for the year.

The group’s bottom line has been flourishing thanks in large part to a contract to supply the US Government with its nasal spray swine flu vaccine and the delay of cheap generic rivals to its Toprol XL heart drug and Casodex cancer drug — though both have now hit the US market. AstraZeneca had $152 million of swine flu nasal spray sales in the third quarter and expects to make a further $300 million from the vaccine this quarter. Toprol XL sales fared even better, more than doubling in the period to $1.15 billion as shipments of a generic version of the drug from Novartis were delayed.

Overall, AstraZeneca’s pre-tax profit jumped to $3.4 billion, as revenues rose by 5 per cent to $8.2 billion. AstraZeneca yesterday lifted its full year earnings per share forecast to a range of $6.20 to $6.40, from $5.70 to $6.00 previously.

The market remains deeply concerned about AstraZeneca’s outlook, though, in the face of the loss of patents on key blockbuster drugs representing 40 per cent of the company’s revenues in the next few years. The group’s Nexium heartburn treatment, its Symbicort asthma treatment, Seroquel, its schizophrenia treatment, and Crestor, its cholesterol-lowering drug, will all be opened up to generic competition in the next five years. Investor concerns were underlined on Wednesday when AstraZeneca withdrew its US and European regulatory applications for its Zactima lung cancer drug after trial data put its effectiveness and approval chances in question.

AstraZeneca sought to reassure the market about its drug pipeline yesterday, announcing that its Brilinta anti blood-clotting treatment has been submitted for regulatory approval in the EU and that submission in the US was likely by the end of the year. But there is also significant uncertainty over this drug, which is forecast to be making annual sales of at least $1.2 billion by 2014. Although trial results outside the US show that it is an effective treatment, trials in the US found that patients received no benefit from it. This inconsistency — and researchers’ inability to explain it — means that the worldwide launch of Brilinta is far from certain. There are concerns, too, about AstraZeneca’s exposure to the US market, where healthcare reforms could lead to significant price falls.

AstraZeneca’s shares were trading at about 7.7 times forecast 2010 earnings at last night’s close — compared with a multiple of 10.5 times at GlaxoSmithKline. This seems about right, since GSK has already suffered much of the pain from the loss of its key patents and is benefiting hugely from sales of swine flu vaccines. Hold.

CSR

These are proving to be heady times for CSR. Joep van Beurden, the chief executive, has presided over a transformation of the company’s fortunes and, more importantly for its long-term prospects, a diversification of its business into new areas since taking the helm two years ago when the bluetooth specialist was struggling.

The acquisition of SiRF Technology, the Silicon Valley-based GPS specialist, in February was bold given the US company was losing market share, losing money and facing a bruising legal spat with Broadcom. However SiRF has not hindered CSR’s progress and the Cambridge company has been winning market share in the GPS sector over the past six months. Yesterday’s third-quarter results show CSR is going from strength to strength. Its gross margin of 45.3 per cent was higher than expected, revenue at $210 million during the period beat expectations and its guide for fourth-quarter sales of up to $200 million was at the top-end of the forecast range. Add to that Mr Van Beurden’s ambition to bulk up the company’s portfolio in areas such as near-field communications — the technology that is used in Oyster cards — and CSR looks to have regained its high-growth reputation. CSR shares have shed 20 per cent over the past two weeks because of concerns about stocks, providing a buying opportunity. The shares trade on only 14 times the upgraded 2010 forecasts, excluding its cash, which is undemanding for a high-growth company.

Cairn Energy

Bill Gammell has built a career out of unconventional thinking. Back in 2002 when his company, Cairn Energy, paid $7.25 million for Shell’s last interests in Rajasthan in India, most people thought it was a waste of money.

Shell had drilled ten dry holes in the area and had given up. But yesterday, Cairn said its four fields in Rajasthan were producing between 5,500 and 11,000 barrels of oil a day — worth about $5.4 million at current prices, or $7.25 million every 32 hours to the Edinburgh-based company and its partners.

It’s not been a bad return on investment and has also offered Cairn the cash to fund further growth. So it’s worth noting that Cairn is now turning its attention to another unconventional place to look for oil: Greenland.

While conditions there are likely to be rather different, Cairn is set to start a drilling campaign in 2011 and earlier this month enlisted the support of Petronas, the Malaysian state oil company, as a partner.

Yesterday, it announced it had sold a 10 per cent stake in its six blocks off Greenland — a fresh sign of progress. While it will take a long time for the campaign in Disko Bay to yield results, Cairn is a mature company with exciting prospects and a strong platform for further growth.

Buy.

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