Falling biopharma sales hurt Pall’s Q2; but Asia shows promise
For the three months ended January 31, revenue from Pall’s biopharmaceuticals business shrank 7.2 per cent to $128,135, after expanding 16.7 per cent in the comparable period in 2008.
Speaking at the industrial filtration and processing giant’s presentation last week, Krasnoff attributed the decline to the biotechnology sector’s reassessment of its spending in the difficult economic climate.
He contrasted this with the year-earlier period relative economic stability and industry investment that saw orders for biopharmaceuticals systems leap 90 per cent over the previous year.
Asian biopharmaceutical sales were a notable exception, growing 4 per cent for the period. Pall CFO Lisa McDermott said that the gains “[reflected] the company’s investment in headcount and infrastructure in this region,” and highlighting India, China and Japan as the key drivers.
Pall Life Sciences’ medical sales were also down, falling 9 per cent after a decline in demand for blood filtration systems in the Western hemisphere, although this drop was expected.
On a more positive note, revenues from Pall’s laboratory filtration business were up for the quarter, climbing some 10 per cent on strong growth in Europe and Asia. Revenues from blood cell therapy and OEM products also made some gains.
Pall group total revenue for the three months ended January 31 fell 13 per cent to $543m from $625m, around $40m less than a consensus estimate of analysts polled by Thompson Reuters.
Despite falling biopharmaceuticals sales, Krasnoff was upbeat about Pall’s prospects. He said the firm is “weathering the [economic] storm”, explaining that: “Our market and geographic diversity provides some shelter.”
“Well-established productivity improvement and cost reduction programs have been advanced to stay ahead of forecasted changes in market demand,” added Krasnoff citing the 110 point base point improvement in gross margins as evidence.
