UPDATE: Baxter 4Q Profit Up 9.5% On Revenue Growth; Earnings Views Weak

Baxter International Inc.'s (BAX) fourth-quarter earnings rose 9.5% as the medical-products company booked sales growth in both its BioScience and medical products segments.

Baxter, unlike some other health-care companies, has seen consistent sales and profit growth in recent quarters as its mix of products -- which includes treatments for cancer, immune disorders and trauma --has made it less susceptible to patients looking to pare medical costs amid a slow economic recovery.

"Despite the global macro environment, Baxter continues to report strong financial growth," Chief Executive Robert Parkinson said Thursday on a post-earnings conference call.

Baxter shares, relatively flat over the past three months, rose 1.9% to $55.40 in early trading Thursday.

However, the company faces some economic challenges, as reflected in its ligher-than-expected outlook. For the current quarter, Baxter projects per-share earnings between 98 cents and $1 on revenue growth of 2%, excluding currency impacts. Analysts surveyed by Thomson Reuters expected $1.05 a share and 3% growth.

For the full year, Baxter sees earnings of $4.47 to $4.57 a share on revenue growth of 4% to 5%. Analysts surveyed by Thomson Reuters expected $4.61 a share and 3% growth.

"2012 guidance comes in below consensus," said Michael Weinstein, analyst at J.P. Morgan Chase & Co. "Baxter faces a number of earnings headwinds in 2012."

Those headwinds include currency impacts from emerging markets, European austerity measures and the shutdown of a Los Angeles facility that could affect inventories in plasma. Company officials said on the conference call that they expect the shutdown, which it will conduct to upgrade the facility, to take place in the second half of this year.

Baxter also has been on a buying spree of late, purchasing the pharmacy-technology developer Baxa Corp. in November for $380 million in cash and agreeing last month to acquire Synovis Life Technologies Inc. (SYNO) in a roughly $325 million deal that is expected to expand Baxter's presence in regenerative medicine and biosurgery.

Baxter reported a profit of $463 million, or 82 cents a share, up from $423 million, or 72 cents, a year earlier. Excluding charges tied to its business optimization initiative and asset impairments, per-share earnings rose to $1.17 from $1.11.

Revenue was $3.59 billion, up 2.7% from a year earlier.

Its October projection was for earnings of $1.15 to $1.18 a share on 1% to 2% revenue growth.

Gross margin rose to 49.1% from 46.3%.

Sales in the BioScience unit, which includes plasma-based medical products such as drugs for treating hemophilia and immune disorders, rose about 3%. At the medical products segment, which includes Baxter's medication delivery and renal businesses, sales rose about 3%.

-By Anjali Athavaley, Dow Jones Newswires; 212-416-4912; [e-mail]

-Melodie Warner and Lauren Pollock contributed to this report.