Baxter International Inc. (BAX) posted a 12% rise in
third-quarter profit as margins rose despite flat revenue.
Earnings beat expectations, and the medical-products maker
boosted its full-year outlook while also giving an upbeat
fourth-quarter sales forecast.
Baxter now expects 2009 non-GAAP earnings of $3.79 to $3.81 a
share, up from July's raised view of $3.76 to $3.80. It also
expects sales growth of up to 1%, up from an earlier expectation
for flat results.
Meanwhile, the company projected fourth-quarter non-GAAP
earnings of $1.02 to $1.04 a share on sales growth of 8% to 10%.
The mean estimates of analysts surveyed by Thomson Reuters was
earnings of $1.04 and sales rising 6% to $3.33 billion.
Baxter's therapies target serious conditions that can't be
ignored - such as cancer, immune disorders and trauma - insulating
the company from the economy's woes. The company also has been
developing a vaccine for the H1N1, or swine-flu, virus, amid a plan
to increase research-and-development spending.
Baxter reported a third-quarter profit of $530 million, or 87
cents a share, up from $472 million, or 74 cents a share, a year
earlier. Excluding costs from product discontinuation and other
items, earnings rose to 98 cents from 88 cents. Baxter's July
forecast was 95 cents to 97 cents.
Net sales inched up 0.2% to $3.15 billion, but rose 6% excluding
currency changes. Analysts expected $3.19 billion.
Revenue rose 5% in the U.S. and 7% internationally, excluding
currency fluctuations.
Gross margin rose to 51.9% from 48.3% amid the sales gains.
Baxter's bioscience business posted a 2% sales rise, or 8% minus
foreign exchange, helped by strong results for recombinant and
antibody therapies and other specialty plasma therapeutics. In
September, the company said it expected to increase sales in the
segment - which includes products for treating hemophilia and
immune-system disorders - by 7% to 9% annually.
Shares closed Wednesday at $57 and didn't trade premarket. The
stock is up 6.4% this year, trailing the broader market.
-By Mike Barris, Dow Jones Newswires; 212-416-2330;
mike.barris@dowjones.com