UPDATE: Abbott Labs 3Q Net Up 36%, Boost '09 Earns View
October 14 2009 - 9:22AM
Dow Jones News
Abbott Laboratories (ABT) reported a 36% increase in
third-quarter profit, helped by higher sales of nutritional
products and heart devices and accelerating sales growth for its
top drug, arthritis treatment Humira.
The Abbott Park, Ill., health-care products company's earnings
exceeded Wall Street expectations, and Abbott also boosted its
financial forecast for 2009.
Abbott shares rose 1.4% in pre-market trading to $50.35.
Abbott has enjoyed solid sales and profit growth in recent years
and avoided some of the pitfalls hurting its pharmaceutical rivals.
But it has still been reliant on certain products for much of its
growth, including Humira - a situation that became troublesome
earlier this year when Humira sales growth decelerated. Abbott
shares are down about 7% year-to-date, though they have been on the
rise in recent weeks.
To further diversify, Abbott has made a series of acquisitions
including its September agreement to purchase Solvay SA's (SVYSY)
pharmaceutical unit for about $6.6 billion cash.
Abbott reported earnings of $1.48 billion, or 95 cents a share,
for the three months ended Sept. 30, compared with $1.09 billion,
or 69 cents a share, a year earlier. The latest quarter included a
gain of 11 cents a share for a patent-litigation settlement and
charges of 8 cents a share for integration and cost-reduction
initiatives, while the year-earlier period had charges of 10 cents
a share for cost reductions.
Excluding these items, earnings rose 16.5% to 92 cents a share,
exceeding the mean estimate of analysts surveyed by Thomson Reuters
of 90 cents a share.
Net sales rose 3.5% to $7.76 billion, in line with Street
expectations, with unfavorable currency-exchange rates slicing off
4.9 percentage points of growth.
Abbott's biggest division, pharmaceuticals, saw sales decline
1.6% to $4.06 billion, with U.S. sales off 6.6% and non-U.S. sales
up 3.8%. Sales of Humira rose 23.8% to $1.49 billion, continuing an
acceleration from earlier in the year when sales growth slowed due
to currency fluctuations and rising copays for some patients.
Abbott boosted its forecast for full-year 2009 Humira sales
growth to a range of 18% to 20%, from a prior range of 15% to 20%.
Abbott had gone into the year expecting at least 25% sales growth
for Humira, but then lowered its expectations.
Sales of HIV drug Kaletra declined 8.7%, combined sales of
cholesterol drugs TriCor and Trilipix were off 1%, and cholesterol
drug Niaspan was up 10.6%. Sales of epilepsy treatment Depakote
plunged 71% due to the availability of generic copycats.
Nutritional sales, which include Similac baby formula, rose 9.8%
to $1.39 billion.
Sales of Abbott's diagnostics products declined 0.3% to $909
million.
Sales growth for Abbott's vascular products - which include the
Xience V artery-opening stent - leveled off at 4.7%, a marked
slowdown from recent quarters. Xience was launched in the U.S. in
the summer of 2008, so this year's third quarter was the first with
meaningful year-earlier comparisons for Xience.
Abbott boosted its 2009 earnings outlook to $3.70 to $3.72 a
share, excluding certain items, from its previous range of $3.65 to
$3.70.
-By Peter Loftus, Dow Jones Newswires; 215-656-8289;
peter.loftus@dowjones.com