BD on the up after impressive Q1 results

By Wai Lang Chu

- Last updated on GMT

Related tags Revenue Bd

Becton Dickinson has reported first quarter earnings that nearly
doubled year-on-year - with sales driven on by the weak American
currency and outweighing increased operating costs.

The soft dollar boosted overseas sales, and more than offset higher raw material costs as well as BD's investment programme in increased manufacturing capacity. The medical device makers expect to beat all growth expectations in 2008 as demand for its cardiac devices continues to grow internationally, buoyed on by the favourable foreign exchange rate. First quarter net income, in the period ended Dec. 31, came in at $271.5m from $142.9m last year. Revenue increased 14 per cent to $1.71bn. In the BD Medical segment, worldwide revenues for the quarter were $909m, representing an increase of 10 per cent over the prior year. Pharmaceutical Systems and Diabetes Care products led revenue growth in the segment, said the company. The diagnostics division fared just as well, posting worldwide revenues of $523m - an increase of 18 per cent. Five percentage points of this growth as well as a boost in fourth quarter earnings were attributable to the $27m acquisition of Tripath, a maker of products to detect and diagnose cancer, in December 2006. Sales of safety-engineered devices and molecular testing systems, including GeneOhm, also contributed to growth. In the BD Biosciences segment, worldwide revenues for the quarter were $274m, representing an increase of 18 per cent over the prior year period. Demand for research instruments as well as clinical and research reagents continued to be the primary growth drivers. BD won US approval earlier this month for a test to diagnose within two hours severe infections including MRSA, or methicillin-resistant Staphylococcus aureus,​ a major improvement on current tests that can take a day to yield results. Edward J. Ludwig, BD's CEO, said: "Expense management enables us to offset the challenges of raw material price increases and manufacturing start-up costs related to increasing capacity to meet growing demand.​" BD's cost cutting measures enabled first quarter revenues in the US to increase to $790m - up 10 per cent - while ex-US turnover rose 17% to $916m, with an 11 point boost from foreign currency translations. S&P Equity Research upgraded BD on the strength of the results, suggesting that diagnostics, pharmaceutical systems and biosciences businesses would be the engine rooms for growth in 2008 as a whole.

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