UPDATE: Baxter Profit Up On Demand For Blood, Immune Therapies
April 19 2012 - 10:51AM
Dow Jones News
Baxter International Inc.'s (BAX) first-quarter earnings rose
3.2% as the medical-products company saw growth across its core
segments, driven by strong demand for its hemophilia and
immunodeficiency treatments, as well as its anesthesia
products.
Results topped the company's own guidance. For the year, it
raised the low end of its per-share earnings outlook by 2 cents to
a range of $4.49 to $4.57, while affirming its revenue growth
view.
Baxter has seen solid sales and profit growth in recent quarters
on the sales of medical devices, pharmaceuticals and
biotechnologies for dire problems such as cancer, immune disorders
and trauma. Because they treat life-threatening diseases and
injuries, many of Baxter's products haven't felt pressure from the
slowdown in health-care spending, as others have.
The Deerfield, Ill., company also reiterated Thursday its
commitment to HyQ, a drug that is infused under the skin and used
to treat immune-system disorders. Baxter and Halozyme Therapeutics
Inc. (HALO) said earlier this week that the U.S. Food and Drug
Administration requested additional information related to
long-term use of the drug. The delay "could compress growth and
margin expansion," said Ben Andrew, analyst at William Blair &
Co.
Baxter Chief Executive Robert L. Parkinson Jr. said Thursday
that the company and Halozyme "will work closely together to
further understand the FDA's request and develop a plan to provide
additional data."
While there has been some speculation on the Street that Baxter
might more aggressively pursue acquisitions as a result of the
delay, Parkinson said that wasn't the case.
Baxter reported a profit of $588 million, or $1.04 a share, up
from $570 million, or 98 cents, a year earlier. Excluding charges
tied to in-process research and development, acquisitions and other
items, earnings rose to $1.01 a share.
Revenue was $3.34 billion, up 3.2% from a year earlier.
Excluding the impact of foreign currency, revenue grew 4%.
In January, Baxter projected earnings of 98 cents to $1 a share
on revenue growth of 2%, excluding currency impacts.
Baxter forecast current-quarter earnings of $1.10 to $1.12 a
share, excluding special items, on revenue growth of 3% to 4%,
excluding currency impacts. Analysts polled by Thomson Reuters
recently projected earnings of $1.12 and flat sales growth.
First-quarter sales at Baxter's medical products segment, which
includes the company's anesthesia products and renal businesses,
rose about 2.7%. Sales in the BioScience unit, which includes
plasma-based medical products such as drugs for treating hemophilia
and immune disorders, increased about 3.8%.
The company recently said it would build a new manufacturing
plant in Georgia in efforts to expands its plasma-based
treatments.
Baxter shares, up 9.9% year to date, fell 10 cents to
$54.29.
-By Anjali Athavaley and Kristin Jones, Dow Jones Newswires;
212-416-4912; anjali.athavaley@dowjones.com
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