* Q2 EPS $0.96 excluding items vs Street view $0.97
* Sees 2012 EPS $3.90-$4.00 vs prior view $3.90 to $4.05
* Revenue up 1 percent to $950 million
* Shares fall 0.7 percent
By Bill Berkrot
July 31 (Reuters) - Life Technologies Corp on Tuesday lowered the high end of its full year profit forecast and said revenue would come in at the low end of its prior outlook, citing unfavorable foreign exchange rates and weakness in Europe.
The company also forecast lower-than-expected third quarter profit and revenue, but said it sees fourth quarter revenue and earnings to be higher than the third quarter.
"Based primarily on increased headwinds from currency and an incrementally more conservative outlook for our European operations, we are revising our 2012 guidance," Chief Executive Gregory Lucier said in a statement.
The maker of genetic testing equipment and products used in biotechnology research and development lowered the high end of its previous forecast range by 5 cents and now expects earnings of $3.90 to $4.00 per share, excluding special items. It now expects organic revenue growth to come in at the low end of its prior 2 percent to 4 percent forecast.
On a conference call with analysts, Lucier said the company began to see a weakening in European markets at the end of the second quarter. The stronger dollar versus the euro also decreases profits of goods sold overseas.
"There is no cliff that we're looking at. We're just trying to be prudent and conservative in our outlook," Lucier said.
For the third quarter, Life Tech said it expects to earn 87 cents to 90 cents per share on revenue of $900 million to $910 million. Wall Street was estimating earnings of 97 cents per share and revenue of $940 million, according to Thomson Reuters I/B/E/S.
The company posted a second quarter net profit of $122.3 million, or 67 cents per share, compared with a profit of $95.5 million, or 52 cents per share, a year ago.
Excluding items, Life Tech said it earned 96 cents per share, missing analysts' average expectations by a penny, according to Thomson Reuters I/B/E/S.
Revenue for the quarter edged 1 percent higher to $950 million, surpassing Wall Street estimates of $943.6 million.
The company said it hopes to offset the earnings per share impact of foreign exchange rates and acquisitions in the second half of the year by reducing discretionary spending. It also plans to repurchase of shares.
Life Tech announced plans to repurchase up to $750 million worth of its shares in addition to some $62 million remaining on a previous repurchase program.
"The core business continues to struggle. In addition they've done a more significant move into diagnostics with some recent deals and other internal investments and that's constraining earnings growth," said ISI Group analyst Ross Muken.
"This business is struggling to grow top line and now almost all of earnings (EPS) growth will probably come from share repurchases," he said, adding that potential looming cuts in U.S. government and academic research spending if Congress fails to agree on a budget remains a concern.
The company's smallest division had the best performance in the quarter as Applied Sciences sales rose 15 percent to $194 million, driven by strong demand for biotech production and forensics products.
Research Consumables sales edged 1 percent higher to $403 million, but Genetic Analysis revenue fell 6 percent to $353 million, hurt by a $30 decline in solid instruments sales and lower royalty payments. Increased sales of Ion Torrent gene sequencing equipment helped offset some of the declines, the company said.
Life Tech shares, which are up about 13 percent for the year, slipped 0.7 percent to $43.58 in extended trading from their Nasdaq close at $43.88.