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UPDATE: Qiagen Cuts Q3 Earnings Forecast Following Terrorist Attacks

NEW YORK, Sept. 21 – Qiagen executives on Friday warned  that third-quarter revenues are likely to fall 11 percent to $63 million as a result of disruptions following the Sept. 11 terrorist attacks in the United States.

Qiagen, which manufactures products for nucleic-acid purification, said it now expected to post third-quarter earnings of four cents a share, compared with a previous estimate of seven cents a share, the executives said in a conference call.

Orders for the company’s products were down last week—on some days as low as 80 percent below average—because of air travel restrictions across the US that curtailed overnight deliveries worldwide, and because many customers did not work a full week, Qiagen CEO Metin Colpan said in the conference call. The air travel disruptions also affected Qiagen’s ability to install its BioRobot systems at customer sites.

Typically, Qiagen customers do not keep a significant backup inventory of the company’s nucleic acid purification and clean-up products, and thus are reliant on overnight delivery, said Peer Schatz, Qiagen’s chief financial officer.

The drop in business came at a crucial period in the quarter, Schatz added, because September is normally the month when orders shoot up following the traditional vacation months of July and August. “A day in September is worth more than a day in July,” he said. “September is the month the quarter is made.”

But executives sought to assure investors that the drop in orders was only a temporary phenomenon, and that underlying demand for their products remained strong. “The business seems to be normalizing, and [order] rates are coming back up again,” Schatz said. “We are extremely confident that our customers are coming back.”

The company said that it was leaving its longer-term estimates unchanged, expecting its business to rebound in the upcoming periods. Wall Street expects the company to post earnings of eight cents a share in the fourth quarter.

Qiagen’s shares have been heading lower since reaching a 52-week high of $48.75 nearly one year ago. On Thursday, Qiagen closed down $1.94, or 12 percent, at $14.20, and in Friday trading shares dropped an additional 11 percent to $12.65 by the early afternoon.

Separately, Schatz said that Qiagen would donate $250,000 worth of nucleic-acid purification products to rescue agencies responsible for identifying victims of the Sept. 11 attacks .

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