C.R. Bard (NYSE:BCR) may have topped Wall Street expectations for 3rd-quarter profits by a penny, but a dip in earnings and lowered sales guidance pushed shares down nearly 2% this morning on The Street despite news of a new acquisition.
The Murray Hill, N.J.-based medical device company reported profits of $129.3 million, or $1.50 per share, on sales of $772.9 million during the 3 months ended Sept. 30, representing a 7.5% sales increase but a 0.6% dip in profits.
Adjusted to exclude 1-time items, earnings per share were $1.64, just beating analysts’ expectations for adjusted EPS of $1.63.
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But CFO Christopher Holland lowered the bottom end of Bard’s 2012 sales guidance, saying the company now expects to log constant-currency sales growth of 3%-4%, from prior guidance of 4% growth.
Fourth-quarter earnings are now pegged at $1.64-$1.68, Holland said, saying, "we’re now aiming at the low end of our original EPS growth target for the year" during a conference call with analysts.
Bard also announced the acquisition of Neomend, an Irvine, Calif.-based company that makes the Progel lung sealant, in a deal that could end up being worth $165 million.
CEO Timothy Ring said Progel is "the only FDA-approved product available for intraoperative sealing of air leaks following lung resection" during the analysts call.
"This product will fit nicely within our surgical business, and we expect to leverage our global infrastructure to drive synergies and grow this exciting platform over the long term," Ring said. "The initial revenue impact will be immaterial to our total sales, and we expect that the acquisition will be about 5¢ dilutive to our Q4 2012 EPS and up to 15¢ dilutive in 2013 and be accretive thereafter."
Terms of the deal call for an up-front cash payment of $140 million and revenue-based milestone payments worth another $25 million through 2016, according to a press release.
