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Abbott Q3 Diagnostics Revenues Rise 5 Percent, MDx Revenues Decline

NEW YORK – Abbott reported today that its 2019 third quarter Diagnostics business revenues rose 5 percent year over year.

For the three months ended Sept. 30, the Abbott Park, Illinois-based firm reported overall revenues of $8.08 billion, up 6 percent on a reported basis from $7.66 billion a year ago but missing the consensus Wall Street estimate of $8.10 billion. The firm said that its organic sales grew 8 percent. Organic sales excluded the impact of foreign exchange and prior-year results for the first three quarters from a US Adult Nutrition business that it discontinued during Q3 2018.

Abbott said its Diagnostics business revenues rose to $1.91 billion from $1.82 billion in the prior-year quarter. Within Diagnostics, Core Laboratory Q3 revenues grew 8 percent year over year to $1.18 billion from $1.09 billion; Molecular revenues fell 8 percent to $111 million from $121 million; Point-of-Care revenues grew 6 percent to $144 million from $136 million; and Rapid Diagnostics revenues were $477 million, down less than 1 percent from $481 million in the prior-year quarter.

Abbott said that in Q3, it continued to achieve strong adoption of its Alinity diagnostic instruments within its Core Laboratory business. Molecular Diagnostics sales were negatively impacted by lower non-governmental organization purchases in Africa, the firm said. Point-of-Care Diagnostics revenue growth was driven by sales of the firm's i-Stat handheld system. Rapid Diagnostics organic sales growth was led by infectious disease testing in developed markets and cardiometabolic testing globally. However, these gains were partly offset by lower than expected infectious disease testing sales in Africa.

"The rollout of Alinity in Europe and other international markets continues to drive strong growth in our core laboratory business outside the US," Abbott CEO Miles White said on a conference call to discuss the firm's financial results. "In the US where we continue to outperform the market with our legacy Architect system, we've made good progress achieving regulatory approvals of immunoassay and clinical chemistry tests for Alinity and are beginning to ramp up our launch efforts in these areas."  

In a statement, he added that the firm is "right on track to achieve ongoing EPS and organic sales growth at the upper-end of our initial guidance ranges for the year."

The firm noted that in Q3, it received US Food and Drug Administration approval for its Alinity s next-generation system for screening blood and plasma.

In its other businesses, Nutrition revenues rose 2 percent to $1.87 billion from $1.84 billion; Established Pharmaceuticals rose 4 percent to $1.21 billion from $1.16 billion; and Medical Devices rose 9 percent to $3.07 billion from $2.82 billion.

Abbott reported net earnings of $960 million, or $.53 per share, in Q3 2018, compared to $563 million, or $.32 per share, in the year-ago period. Adjusted EPS for the recently completed quarter was $.84, matching analysts' consensus estimate.

The firm spent $596 million on R&D in Q3 2019, up 4 percent from $574 million in Q3 2018, and logged $2.44 billion in SG&A expenses, up 3 percent from $2.38 billion in the prior-year quarter.

Abbott narrowed its full-year 2019 guidance range for earnings per share on a GAAP basis to $2.06 to $2.08. During its Q2 earnings announcement, the firm guided to EPS of between $2.06 and $2.12. On an adjusted basis, 2019 EPS is expected to be between $3.23 and $3.25, compared to a prior guidance of between $3.21 and $3.27.

Abbott issued Q4 2019 guidance for EPS of $0.59 to $0.61 and adjusted EPS of $.94 to $.96.

In September, Abbott announced a quarterly dividend of $.32 per share, payable Nov. 15 to shareholders of record on Oct. 15.

In early morning trading on the New York Stock Exchange, Abbott's shares were down more than 1 percent at $80.60.