Abbott Raises Earnings Outlook as Revenue Climbs
Abbott Laboratories
ABT -2.25%
raised its annual earnings guidance after posting higher than expected revenue from Covid-19 testing products.
Abbott, based in Abbott Park, Ill., now forecasts $6.1 billion in revenue from sales of Covid tests this year, up by nearly a third from an earlier projection. Most of those sales have already occurred. It expects just $500 million in sales coming in the next few months.
Without the testing revenue, worldwide sales would have dropped during the quarter, after Abbott halted production and issued a recall in February on Similac and other infant formulas made at one of its U.S. plants.
The Food and Drug Administration found what it described as unsanitary conditions at Abbott’s formula-making plant in Sturgis, Mich., during an inspection last winter related to reports of infant illnesses.
The resulting manufacturing shutdown and voluntary recall, which exacerbated an existing baby-formula shortage in the U.S., led to a 7.4% drop in second-quarter sales for Abbott’s nutrition business, the company said Wednesday.
Meanwhile, the top line for Abbott’s diagnostics business jumped by nearly a third on $2.32 billion in Covid testing sales. Those sales were led by products from its rapid diagnostics unit, while testing-products sales from its core laboratory and molecular diagnostics businesses declined.
Abbott delivered about one billion Covid tests during 2021, bringing in $7.68 billion in sales for the year. In December, the company predicted that it would sell $2.5 billion in Covid tests during 2022. That forecast rose to $4.5 billion in April and climbed again on Wednesday.
The company’s medical-devices business saw higher quarterly sales as well, though some of that growth was offset by fewer cardiovascular and neuromodulation procedures due to recent Covid surges, lockdowns in China and healthcare staffing challenges.
For the quarter ended June 30, Abbott reported net earnings of $2.02 billion, or $1.14 a share, compared with $1.19 billion, or 66 cents a share, in the same period a year ago.
Stripping out costs associated with the baby-formula recall, acquisitions and other one-time items, adjusted earrings were $1.43 a share. Analysts polled by FactSet had been expecting $1.13 a share.
Net sales were $11.26 billion, compared with $10.22 billion last year. Analysts surveyed by FactSet had been expecting $10.3 billion.
Abbott said it now expects adjusted earnings of at least $4.90 a share this year, up 20 cents from its previous forecast.
Shares fell 3% to $106.50 in premarket trading.
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Abbott Laboratories
ABT -2.25%
raised its annual earnings guidance after posting higher than expected revenue from Covid-19 testing products.
Abbott, based in Abbott Park, Ill., now forecasts $6.1 billion in revenue from sales of Covid tests this year, up by nearly a third from an earlier projection. Most of those sales have already occurred. It expects just $500 million in sales coming in the next few months.
Without the testing revenue, worldwide sales would have dropped during the quarter, after Abbott halted production and issued a recall in February on Similac and other infant formulas made at one of its U.S. plants.
The Food and Drug Administration found what it described as unsanitary conditions at Abbott’s formula-making plant in Sturgis, Mich., during an inspection last winter related to reports of infant illnesses.
The resulting manufacturing shutdown and voluntary recall, which exacerbated an existing baby-formula shortage in the U.S., led to a 7.4% drop in second-quarter sales for Abbott’s nutrition business, the company said Wednesday.
Meanwhile, the top line for Abbott’s diagnostics business jumped by nearly a third on $2.32 billion in Covid testing sales. Those sales were led by products from its rapid diagnostics unit, while testing-products sales from its core laboratory and molecular diagnostics businesses declined.
Abbott delivered about one billion Covid tests during 2021, bringing in $7.68 billion in sales for the year. In December, the company predicted that it would sell $2.5 billion in Covid tests during 2022. That forecast rose to $4.5 billion in April and climbed again on Wednesday.
The company’s medical-devices business saw higher quarterly sales as well, though some of that growth was offset by fewer cardiovascular and neuromodulation procedures due to recent Covid surges, lockdowns in China and healthcare staffing challenges.
For the quarter ended June 30, Abbott reported net earnings of $2.02 billion, or $1.14 a share, compared with $1.19 billion, or 66 cents a share, in the same period a year ago.
Stripping out costs associated with the baby-formula recall, acquisitions and other one-time items, adjusted earrings were $1.43 a share. Analysts polled by FactSet had been expecting $1.13 a share.
Net sales were $11.26 billion, compared with $10.22 billion last year. Analysts surveyed by FactSet had been expecting $10.3 billion.
Abbott said it now expects adjusted earnings of at least $4.90 a share this year, up 20 cents from its previous forecast.
Shares fell 3% to $106.50 in premarket trading.
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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