Skip to main content

Abbott Q4 Revenues Up 3 Percent, Driven by Diagnostic Products Growth

NEW YORK (GenomeWeb) – Abbott reported on Wednesday that its fourth quarter diagnostic revenues grew 3 percent year over year, despite an unfavorable 1 percent effect from foreign exchange.

Its molecular diagnostics revenues dropped 8 percent driven by a planned scale down of its genetics business that offset growth in infectious disease testing.

Separately, Alere, the subject of a proposed acquisition by Abbott, said today that the European Commission has granted clearance for the deal. Abbott's commitment to the deal remains in doubt, however, because it had filed a complaint in December with the Delaware Chancery Court in an effort to terminate the proposed transaction.

For the three months ended Dec. 31 2016, Abbott reported worldwide revenues of $5.33 billion, up 3 percent from $5.19 billion a year ago, and short of the Wall Street estimate of $5.38 billion.

In Q4, Abbott's worldwide Diagnostics revenues grew to $1.26 billion from $1.22 billion in the year-ago period. On an operational basis, Worldwide Diagnostics revenues grew 4 percent.

Within worldwide Diagnostics, molecular diagnostics sales totaled $117 million, down 8 percent from $126 million in Q4 2015. Core Laboratory sales were $1 billion, up 4 percent from $969 million in Q4 2015. And Point of Care sales were $135 million, up 8 percent from $125 million in the prior-year period.

"In Diagnostics, we achieved another year of above-market sales growth in 2016, and importantly we initiated the global launch of Alinity, an integrated family of next-generation diagnostic systems for every area of diagnostics in which we compete," Abbott CEO Miles White said in a conference call today to discuss the company's financial report.

He noted that the Alinity solutions represent "a major leap forward over competitive systems in terms of automation, throughput, space efficiency, and ease of use, which will help our customers address issues they face every day, including higher testing volumes, constrained staffing and space, and complex, disparate processes and instruments."

In other business units, Q4 Nutrition sales were down 4 percent year over year on a reported basis to $1.73 billion; Established Pharmaceuticals were up 11 percent to $979 million; and Medical Devices grew 4 percent to $1.35 billion.

Abbott's Q4 R&D expenses were down 7 percent compared to a year ago to $343 million from $369 million, while its SG&A expenses were down 3 percent to $1.61 billion from $1.66 billion.

The firm's Q4 net income was $798 million, or $.53 per share, compared to $767 million, or $.51 per share, in Q4 2015. Its adjusted EPS from continuing operations, excluding specified items, was $.65 per share, in line with previous guidance and analysts' average consensus estimate.

For the full-year 2016, the firm reported worldwide revenues of $20.85 billion, up 2 percent from $20.41 billion a year ago, and just short of the average Wall Street estimate of $20.9 billion.

Abbott's worldwide Diagnostics sales for 2016 were $4.81 billion, up 4 percent on a reported basis from the year-ago period. On an operational basis, worldwide Diagnostics sales increased 5 percent.

Within worldwide Diagnostics for 2016, molecular diagnostics sales totaled $456 million, down 2 percent on a reported basis from 2015. Core Laboratory sales were $3.84 billion, up 4 percent from 2015. And Point of Care sales were $513 million, up around 9 percent from the prior year period.

In other business units, 2016 Nutrition sales were down 1 percent year over year to $6.90 billion; Established Pharmaceuticals were up 4 percent to $3.86 billion; and Medical Devices grew 4 percent to $5.23 billion.

Abbott's 2016 R&D expenses were up 1 percent from 2015 to $1.42 billion from $1.41 billion, while its SG&A expenses were down 2 percent to $6.67 billion from $6.79 billion.

The company's 2016 net income was $1.40 billion, or $.94 per share, compared to $4.42 billion, or $2.92 per share, in 2015. The firm's 2016 adjusted EPS from continuing operations, excluding specified items, was $2.20 per share, in line with analysts' average consensus estimate.

The firm issued full-year 2017 guidance for diluted earnings per share from continuing operations under GAAP of $0.92 to $1.02, including amortization and integration expenses related to the acquisition of St. Jude Medical.

Excluding specified items, projected adjusted diluted earnings per share from continuing operations is $2.40 to $2.50 for the full year 2017, Abbott said.

Abbott issued first quarter 2017 guidance for diluted earnings per share from continuing operations under GAAP of $0.19 to $0.21. Excluding specified items, projected adjusted diluted earnings per share from continuing operations is $0.42 to $0.44 for the first quarter, Abbott said.

During Q4, Abbott obtained a CE mark for several Alinity core laboratory systems, including Alinity s for blood and plasma screening, Alinity c for clinical chemistry, and Alinity i for immunoassay diagnostics.

Point-of-care sales growth in the quarter was driven by continued adoption of Abbott's i-STAT handheld system in the US, and ongoing international market expansion, the firm said.

During the quarter, Abbott obtained CE Mark for its i-STAT Alinity handheld portable blood testing system. By delivering results in 10 minutes or less using only two to three drops of blood, i-STAT Alinity provides healthcare professionals the information needed to make fast and accurate medical decisions without ever leaving their patient's side, Abbott said.

In early morning trade on the New York Stock Exchange Wednesday, shares of Abbott were down around 1 percent at $39.74.