Abbott sales and profit propped up by St Jude acquisition
Global nutrition business continues to suffer amid challenges in Chinese market
Abbott’s quarterly net sales rose 3.2% on an operational basis to $6.34bn. Photograph: Tim Boyle/Bloomberg
Healthcare company Abbott Laboratories reported higher-than-expected quarterly sales and profit on Wednesday, driven by its $25 billion (€23.3 billion) acquisition of St Jude Medical.
Net sales at the company, which completed the St Jude acquisition in January, rose 3.2 per cent on an operational basis to $6.34 billion, ahead of the average analyst estimate of $6.15 billion. But, while sales in its diagnostics, medical devices and branded generic pharmaceuticals divisions grew in the three months to end-March 31st, Abbott’s nutrition business continued to suffer.
Global nutrition sales dipped 1 per cent on an operational basis to $1.64 billion, hurt mainly by continuing challenging conditions in the Chinese infant formula market.
Abbott earned 48 cents per share before exceptionals, beating the average analyst estimate by 5 cents. Net profit from continuing operations came in at $843 million, or 22 cents per share, in the quarter, compared with $615 million, or four cents per share, a year earlier. The results also reflect St Jude’s year-over-year results.
Abbott last week agreed to buy troubled diagnostics company Alere at a lower price of around $5.3 billion, below the $5.8 billion previously announced, ending a prolonged legal battle. The deal ran into trouble shortly after being announced in February, after issues related to Alere’s accounting and sales practices came to light. Both companies ended up suing each other last year, with Alere forcing Abbott to move ahead with the deal, and Abbott wanting to pull out.
The revised deal is expected to close in the third quarter, and will help Abbott expand in point-of-care diagnostic testing, a market that is growing as doctors increasingly adopt rapid tests that speed up treatment. – Reuters