Shares in Abbott (NYSE:ABT) have risen today in pre-market trading after the medical device maker beat expectations on Wall Street with its fourth quarter and full fiscal year 2017 earnings results.
The Abbott Park, Ill.-based company posted losses of $828 million, or 50¢ per share, on sales of $7.6 billion for the 3 months ended December 31, seeing the bottom-line slide 203.8% while sales grew 42.3% compared with the same period last year.
Adjusted to exclude one-time items, earnings per share were 74¢, just ahead of the 73¢ consensus on Wall Street, where analysts were looking to see sales of $7.4 billion.
For the full year, Abbott posted profits of $477 million, or 27¢ per share, on sales of $27.4 billion, seeing the bottom-line shrink 65.9% while sales grew 31.3% compared with the same period last year.
After adjusting to exclude one time items, earnings per share were $2.50, just in line with consensus on Wall Street where analysts were expecting to see sales of $27.2 billion, which the company also handily beat.
“2017 was a great year for us – we performed well, our new product pipeline was highly productive and we took some very important strategic steps forward. We’re entering 2018 with very good momentum,” chair & CEO Miles White said in a press release.
Abbott released financial guidance for the 2018 fiscal year, expecting to see GAAP diluted earnings per share of between $1.22 and $1.32, with non-GAAP EPS between $2.80 and $2.90.
For its first quarter of 2018, Abbott said it expects to GAAP EPS of between 16¢ and 18¢, with non-GAAP EPS of between 57¢ and 59¢.
In its guidance for the coming year, Abbott said it is committed to reducing its debt levels following its acquisitions of St. Jude and Alere, having generated operating cash flow in excess of $5 billion and free cash flow in excess of $4 billion.
This month, Abbott said it repaid $4 billion in debt and anticipates additional debt repayments this year.
The fourth quarter was Abbott’s “best quarter yet,” according to Leerink Partner analyst Danielle Antalffy, based on the company’s sales growth performance.
Sales growth performance was strong for the company, which posted operational sales growth across all divisions except established products, according to Antalffy.
“To us, ABT is very much an execution story as the company integrates 2 recent major acquisitions — STJ and ALR — and drives a new product cycle through its medical devices business and a steady turnaround in its nutritionals business. And this quarter’s performance seems to be a positive data point supporting the view that ABT can successfully execute. We do need to hear management’s commentary around the puts and takes to 2018 guidance — i.e., operational sales growth assumptions and whether 4Q momentum is sustainable, and the impact of lower tax to the slightly higher EPS guide vs. consensus. But, our initial take here is that ABT shares should trade up on this print,” Antalffy wrote in a letter to investors.
Shares in Abbott have risen in pre-market trading today, up 2.4% at $60.65 as of 9:02 a.m. EST.
