NORTH CHICAGO (dpa-AFX) - Diversified healthcare company Abbott Laboratories (ABT) on Wednesday reported a 31 percent decline in profit for the first quarter from last year, reflecting lower sales and one-time charges.
However, ongoing earnings per share beat analysts' estimates, while sales missed their expectations. Looking ahead, the company maintained its ongoing earnings outlook for fiscal 2014, in line with Street view.
On January 1, 2013, Abbott completed the separation of its research-based pharmaceuticals business, which became AbbVie Inc. (ABBV), a new independent bio-pharmaceutical company.
The Abbott Park, Illinois-based company reported net earnings for the first quarter of $375 million or $0.24 per share, down from $544 million or $0.34 per share in the prior-year quarter.
The latest quarter's results include after-tax charges of $302 million or $0.19 per share for intangible amortization expense, expenses associated with cost reduction initiatives, as well as current quarter tax expense associated with a one-time repatriation of 2014 ex-U.S. earnings.
Excluding specified items, ongoing earnings for the quarter were $0.41 per share, compared to $0.42 per share in the year-ago quarter.
On average, 20 analysts polled by Thomson Reuters expected the company to report earnings of $0.36 per share for the quarter. Analysts' estimates typically exclude one-time items.
Net sales for the quarter declined 2.5 percent to $5.24 billion from $5.38 billion in the same quarter last year, and missed analysts' consensus estimate of $5.28 billion.
Worldwide sales increased 0.5 percent on an operational basis, excluding an unfavorable 3.0 percent effect of foreign exchange.
Total U.S. sales for the quarter decreased 2.5 percent from the year-ago period to $1.49 billion, while international sales declined 2.3 percent to $3.76 billion.
Abbott estimates that the August 2013 sales disruption in International Nutrition and the timing of supply of key products in Established Pharmaceuticals, primarily related to an expected plant shutdown for capacity expansion purposes, reduced its international sales growth by about 2.6 percentage points. International sales account for more than 70 percent of Abbott's total sales.
Sales in key emerging markets in the quarter were $531 million, increasing 0.2 percent on an operational basis and declining 9.2 percent on a reported basis. Sales performance in the quarter was impacted by the timing of supply of key products in Abbott's women's health portfolio, primarily related to an expected plant shutdown for capacity expansion purposes.
Worldwide nutrition sales for the quarter declined 4 percent from the year-ago period to $1.63 billion. Worldwide medical devices sales decreased 1 percent to $1.31 billion and established pharmaceuticals sales decreased 7 percent to $1.15 billion. Meanwhile, worldwide diagnostics sales grew 3 percent year-over-year to $1.12 billion.
Total operating cost and expenses for the quarter edged up 0.6 percent to $4.79 billion. Of this, research and development expenses rose 12 percent from the year-ago period to $387 million, while selling, general and administrative expenses declined 1 percent to $1.76 billion.
Looking ahead to fiscal 2014, Abbott maintained its outlook for ongoing earnings in a range of $2.16 to $2.26 per share, representing double-digit growth at the mid-point of the guidance range. The company forecasts reported earnings per share from continuing operations in a range of $1.13 to $1.23 per share.
Analysts expect the company to report earnings of $2.20 per share for the year.
ABT closed Tuesday's regular trading session at $37.97. In Wednesday's pre-market, the stock is up $0.53 or 1.40 percent to $38.50.
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