(By Balaseshan) Abbott Laboratories (NYSE:ABT) reported a jump in quarterly earnings due to lower charges and expenses. Despite revenue missing consensus, adjusted earnings exceeded Street's expectations. Further, the drug maker narrowed its full year ongoing profit view.
The company's profit for the third quarter climbed 541.3 percent to $1.94 billion. On an adjusted basis, earnings rose to $2.08 billion or $1.30 per share from $1.85 billion or $1.18 per share.
Net sales declined marginally by 0.4 percent to $9.77 billion. Currency had an unfavorable impact of 4.5 percent during the third quarter. Excluding currency impact, net sales would have witnessed close to 4.1 percent upside.
Analysts, on average, polled by Thomson Reuters had expected earnings of $1.28 per share on revenue growth of 1.20 percent to $9.93 billion for the third quarter.
For the second quarter of 2012, Abbott had adjusted earnings of $1.23 a share on sales of $9.81 billion.
The results included a 340 basis points growth in adjusted gross margin ratio of 63.8 percent, driven by improved efficiencies across a number of operating divisions, favorable product mix and the effect of foreign exchange. The gross margin ratio under GAAP was 62.2 percent.
Looking ahead into the fiscal 2012, the company narrowed its ongoing earnings guidance to range of $5.06 to $5.08 per share from previous forecast of $5.00 to $5.10 per share, while Street analysts predict $5.06 per share.
The ongoing EPS forecast is reflecting another year of expected strong performance. Including specified items, projected EPS under GAAP would be $3.83 to $3.85 for the full-year 2012.
"There were several product launches across pharmaceuticals, vascular and diagnostics, which will contribute to future growth. In addition, we remain on track to separate into two leading health care companies on January 1, 2013," said Miles White, chairman and chief executive officer, Abbott.
In addition, Abbott announced the initiation of a Phase 3 clinical trial evaluating interferon-free hepatitis C (HCV) program in genotype 1 (GT1) patients, following positive results from the Phase 2b Aviator study, the largest and most comprehensive HCV trial to date.
Initial results from Aviator showed sustained virological response at 12 weeks post treatment (SVR12) in 99 percent of treatment-naive and 93 percent of null responders for GT1 patients taking a combination of ABT-450/r, ABT-267, ABT-333 and ribavirin.
ABT closed Tuesday's regular session at $72.13. The stock has been trading between $51.53 and $72.47 for the past 52 weeks.