Baxter
(NYSE: BAX)
shares fell this morning on second-quarter results that came in mixed compared to the consensus forecast.
Shares of BAX fell 4.1% to $46.92 apiece in mid-morning trading today. MassDevice’s MedTech 100 Index — which includes stocks of the world’s largest medical device companies — rose slightly.
The Deerfield, Illinois-based company recorded losses of $141 million. That amounts to 28¢ per share on sales of $3.7 billion for the three months ended June 30, 2023.
Baxter posted a bottom-line slide into the red on sales growth of 0.4%.
Adjusted to exclude one-time items, earnings per share came in at 66¢, landing 5¢ ahead of expectations on Wall Street. However, sales from continuing operations missed the analysts’ forecast for $3.8 billion. Including discontinued operations, sales totaled $3.85 billion, topping those estimates.
What contributed to the second-quarter results for Baxter?
Baxter attributed its sales performance, which topped its own guidance, to overall positive demand for its products. The company also cited ongoing recovery in patient and procedure volumes, plus generally stabilizing macroeconomic conditions. Baxter also pointed to an ongoing abatement in recent supply chain challenges.
However, the company’s losses relate to business optimization costs and intangible amortization, among other factors.
“Baxter’s second-quarter performance reflects ongoing solid demand for our diverse, durable portfolio of medically essential products,” said José (Joe) E. Almeida, chair, president and CEO. “We are making progress across the transformational actions we announced at the start of 2023. These initiatives are focused on enhancing strategic clarity, increasing market responsiveness and accelerating innovation, in an effort to drive greater value for our stakeholders.”
Baxter’s kidney care spinoff remains on track while the sale of its biopharma solutions (BPS) has some uncertain timing, the company said. It plans for this to complete toward the end of the third quarter.
With that uncertainty, Baxter provided a financial outlook with a scenario in which the transaction doesn’t close this year. If BPS remains a part of Baxter in 2023, it expects sales growth for between 1% and 2%. The company projects adjusted EPS to range between $2.92 and $3.
If the sale goes through, Baxter projects no change to its sales guidance but adjusted EPS between $2.87 and $2.95.
