Abbott (NYSE:ABT) stock is down about 2% today after its fourth-quarter sales failed to meet analyst expectations.
The Abbott Park, Ill.–based maker of medical device, pharmaceutical, nutrition and diagnostics products brought in about $7.765 billion in revenue in the quarter ended Dec. 31, 2018. The sales were up 2.3% from $7.589 billion earned during the same period a year ago but missed the $7.82 billion consensus of analysts polled on Yahoo! Finance.
Earnings actually met expectations, and Abbott’s board in December even upped the company’s quarterly dividend 14.3%, to 32 cents per share.
Fourth-quarter earnings were $654 million, or 37 cents per share, versus a loss of $828 million, or 48 cents per share, a year before. Excluding items, Abbott saw a profit of 81 cents per share, meeting Wall Street expectations.
For the full year of 2018, Abbott saw revenue of $30,578 billion, up 11.6% from $27.390 billion a year before. Earnings excluding items were $2.88 per share, up from $2.50 per share a year before.
Abbott CEO Miles D. White in a news release described 2018 as an outstanding year. “We exceeded the organic sales growth range we set at the beginning of the year, achieved a number of significant advances in our pipeline, and significantly improved our balance sheet and strategic flexibility. We’re very well-positioned heading into 2019.”
Abbott’s medical device business performed especially well. Sales increased 6.7% year-over-year, to $2,920 billion, during the fourth quarter. For the full year, sales were up 10.1% on a reported basis and 9.1% on an organic basis.
Abbott reported that people with diabetes are increasingly using its FreeStyle Libre sensor-based continuous glucose monitoring system, which helped drive Diabetes Care business sales up 28.3% on a reported basis and 32.4% on an organic basis in the fourth quarter. The FreeStyle Libre, which removes the need for routine fingersticks, attracted 300,000 new customers in the quarter, White told analysts, according to a Seeking Alpha transcript.
White estimated that FreeStyle Libre had 1.3 million active users worldwide at the end of 2018, including approximately two-thirds type 1 diabetics and one-third type 2. Greater awareness of the product in the U.S. and an emerging trend of Libre landing preferred copay status versus other companies’ helped domestic sales, he added.
“This affordable and simple-to-use device is fundamentally changing the way people with diabetes manage their disease and given the fact that more than 400 million people are living with diabetes around the world, Libre promises to be a significant growth driver for years to come,” White told analysts.
Abbott’s electrophysiology sales jumped 20.8% amid strong performance in cardiac mapping and ablation catheters. FDA recently approved the company’s TactiCath contact force ablation catheter, a new sensor-enabled catheter intended for use in treating atrial fibrillation.
In the transcatheter aortic valve replacement (TAVR) segment, the company expects to file for FDA approval of its Portico device in the second half of 2019, Scott Leinenweber, Abbott’s VP of investor relations, told analysts.
Structural Heart was up 14.4%. Devices that were sales hits included the Amplatzer PFO occluder, designed to close a hole-like opening in the heart, and the MitraClip, which provides minimally invasive treatment of mitral regurgitation.
Senior editor Nancy Crotti contributed to this report.
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