Abbott Labs Profit Rises, Helped by Emerging Markets

By Ezequiel Minaya 

Abbott Laboratories Inc. said Wednesday that profit grew 7.8% in its latest quarter as results were aided by emerging markets growth.

Shares rose 2.5% to $42.78 in early trading as revenue and adjusted profit edged above Wall Street's estimates.

In the wake of the results, Abbott narrowed its annual guidance range for earnings per share, excluding specified items, to $2.14 to $2.16 from a previous range of $2.10 to $2.20.

Sales in emerging markets provided a boost for the Illinois-based health-care company, jumping 8.2%. Operational sales growth in the quarter was led by India, Russia, Brazil, China, and several markets throughout Latin America, the company reported. Revenue in the U.S. declined 0.7%.

Analysts for Evercore ISI said relative to investors' fears of a slowdown in emerging markets, Abbott delivered solid results.

"We also note that the nutritional segment growth was exceptionally strong despite the tougher comps and fears around potential consumer weakness impacting China nutritionals," they added.

Worldwide pediatric nutrition revenue increased 4.1%, with growth led by the Eleva product in China and Similac Advance in the U.S.

Worldwide adult nutrition dipped 4.5%, which included a 7.1% foreign exchange drag. Worldwide medical devices and worldwide diabetes care sales dipped 7.4% and 8.4%, respectively.

Established pharmaceuticals sales climbed 24.6%, shaking off an 18% dent from currency impacts.

Overall, the company posted a profit of $580 million, or 38 cents a share, up from $538 million, or 36 cents a share, a year earlier. Excluding certain items, earnings per share remained flat at 54 cents.

Revenue rose 1.4% to $5.15 billion.

Analysts surveyed by Thomson Reuters forecast per-share earnings of 53 cents on revenue of $5.14 billion.

Abbott has been realigning its business in a series of deals. Last year, Abbott reached an agreement to shed a portion of its generics pharmaceuticals business to Mylan Inc., a transaction that underscored a trend of health-care mergers-and-acquisitions driven in part to seek tax advantages.

Write to Ezequiel Minaya at [e-mail]

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(END) Dow Jones Newswires

October 21, 2015 10:35 ET (14:35 GMT)

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