Valeant Pharmaceuticals International (TSE:$VRX) saw its shares rise sharply in Tuesday’s trading session, as upper management announced tremendously promising progress in resolving financial and legal issues that had haunted its business for the past 2 years.

Having faced severe repercussions due to unethical business practices in the past few years, Valeant stated that it is ahead of its debt-reduction schedule, and has made progress on the legal issues that occurred.

Additionally, Valeant seems to be in good health, as when divestitures are excluded, its core businesses Bausch + Lomb and Salix International posted combined revenue growth figures of 8% year over year.

As Joseph Papa, Valeant’s chairman and chief executive explains, “We clearly are looking at what we think are exciting opportunities for the future of Valeant.”

Joseph Papa also noted that the company’s dermatology business continues to be hampered by previous legal issues. However, the executives are working hard in order to rectify these impediments.

Joseph Papa continues, “And that will really be our focus for the next three months and next year.”

Thanks to the sale of some company assets, and the reduction of debt on their balance sheet, Valeant was able to report second-quarter losses that saw a reduction to $38 million. This reduction in losses translated to a significantly less concerning loss of 11 cents per share compared to the loss of $302 million that translated to a loss of 88 cent per share in 2Q16.

As a result of the sales, however, Valeant also saw a year-over-year decline in revenue from $2.42 billion to $2.23 billion USD. The trend is consistent, as adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) dropped from $1.09 billion last year to $951 million.

Lower prices and the divestiture of a skin care business within Bausch + Lomb are the reasons Valeant referenced for the decline in revenue.

Lowered Guidance

As a result of the company’s divestitures crucial for Valeant’s debt situation and profitability, management has reinstated revenue guidance from a range of $8.90 and $9.10 billion to somewhere in between $8.70 billion and $8.80 billion. As per management comments, the company believes its earnings before interest, taxes, depreciation and amortization are on track to achieve $3.60-$3.75 billion this year.

Despite recent rallies, Valeant is still a far cry away from reaching its former glory, when it traded above $300.

Albeit, that former Valeant was built on immoral business practices with their partner Philidor Rx Services. This led to its ultimate downfall, as the company suffered from political and regulatory pressure, in addition to negative press under Michael Pearson, the former Chief Executive.

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