NEW YORK (GenomeWeb) – Becton Dickinson today reported a 2 percent year over year increase in fiscal first quarter revenues as growth in both its Life Sciences and Medical segments was tempered by an unfavorable currency impact.
For the three months ended Dec. 31, BD reported revenues of $2.05 billion compared to $2.02 billion in the same quarter last year and beating analysts' consensus estimate of $2.01 billion. On a currency-neutral basis, revenues increased about 5 percent year over year, BD said.
In October, BD reorganized its business into a two-segment structure comprising Life Sciences and Medical. The Life Sciences segment houses the pre-analytical systems, diagnostic systems, and biosciences business units, while the Medical segment is now composed of the medical/surgical systems, pharmaceutical systems, and diabetes care units.
In fiscal Q1, Life Sciences revenues were $979 million, a 3 percent increase over $951 million in the year-ago period, or a nearly 7 percent increase on an adjusted basis. Growth in the segment was driven by strong sales across all three business units, BD said, adding that diagnostics growth was aided in part by a stronger-than-expected flu season compared to the prior year.
Within Life Sciences, diagnostics sales tallied $691 million, a 3 percent increase over the year-ago period, or a 7 percent spike on an adjusted basis. Biosciences revenues, meanwhile, were $288 million, a 3 percent rise on a reported basis or a 7 percent increase on an adjusted basis.
Preanalytical systems growth of about 5 percent was driven by safety engineered products and geographic expansion, Christopher Reidy, CFO and executive vice president of administration for BD, said during a conference call recapping the firm's earnings.
Meantime, diagnostic systems growth "was driven by core microbiology growth, which reflects a stronger flu season and strong blood culture performance," Reidy said. "We continue to capture significant share with our Veritor [digital immunoassay] platform. We now have over 15,000 instruments in use today at hospitals, clinics, and doctors' offices." He added that the company also continues to see "good traction" with its BD Max molecular diagnostics platform.
Reidy also noted that biosciences revenue growth was driven by "strong instrument placements and international growth."
Meantime, Medical revenues increased 1 percent to $1.07 billion from $1.06 billion in fiscal Q1 2014, or 4 percent on a currency-neutral basis, driven by strong sales in medical surgical systems but unfavorably impacted by ordering patterns in pharmaceutical systems.
For fiscal Q1, BD reported net income of $236 million, or $1.20 per share, compared to $271 million, or $1.37 per share, in the year-ago period. On an adjusted basis, EPS was $1.53, ahead of the Wall Street estimate of $1.43.
BD's R&D costs rose nearly 3 percent to $129 million from $126 million in fiscal Q1, while SG&A costs rose 2 percent to $544 million from $531 million.
For fiscal year 2015 BD estimates that revenues will increase 5 percent on a currency-neutral basis, an increase from previously issued guidance of 4.5 to 5 percent. On a reported basis, revenues are expected to be about flat to a decline of 1 percent due to an unfavorable currency impact.
BD's EPS from continuing operations is expected to be between $5.98 and $6.05 on a currency-neutral basis. Including the estimated unfavorable impact of foreign currency, EPS is expected to be between $6.50 and $6.57.
"Our solid revenue growth and operating performance this quarter in combination with our performance in fiscal year 2014 gives us the confidence to raise our fiscal year 2015 curency-neutral revenue and earnings guidance," CEO and President Vincent Forlenza said during the call.
BD noted that the guidance estimates provided are for the company on a standalone basis. The company will provide guidance inclusive of its pending $12.2 billion acquisition of CareFusion after the close of the transaction, which is on track for the current quarter of the calendar year.