* Q3 EPS $1.01 vs 97 cents expected by Wall Street
* Sales up 3 pct; raises lower end of full-year outlook
* Shares rise almost 4 pct to six-month high
(Adds conference call, analyst comment, trading activity,
By Debra Sherman
CHICAGO, Oct 21 Baxter International Inc
(BAX.N) reported higher quarterly earnings, beating Wall Street
estimates, as demand improved for its plasma proteins and
antibody therapy, and expenses declined.
The maker of blood therapy products, medication infusion
pumps and products used for kidney dialysis also raised its
2010 sales outlook and the lower end of its earnings forecast,
saying the market for plasma proteins and antibody therapy,
known as IVIG, -- part of its core Bioscience business -- has
begun to stabilize
"After a challenging start to the year, it looks like
they're back on track with the market stabilizing," said
Leerink Swann analyst Rick Wise, noting that this latest
quarter represents the strongest growth quarter for both IVIG
and plasma since the fourth quarter of 2009.
During a conference call, Chief Executive Bob Parkinson
told analysts that Baxter had given up little market share and
has finalized contracts through 2011 with most of its large
hospital accounts for Gammagard liquid, an antibody therapy
used to treat immunodeficiency disorders.
In the third quarter, net earnings rose to $594 million, or
$1.01 per share, from $532 million, or 87 cents per share, in
the same 2009 quarter.
Analysts on average expected 97 cents per share, according
to Thomson Reuters I/B/E/S.
The company has purchased some 26.3 million shares year to
date so a lower share count was used to calculate earnings per
share for the past quarter.
Worldwide sales rose 3 percent to $3.2 billion, with sales
at its medication delivery business rising 7 percent and sales
at its bioscience and renal units each rising 3 percent.
Total U.S. sales rose 4 percent to $1.4 billion, while
international sales rose 1 percent to $1.8 billion. Excluding
the impact of foreign currency, international sales rose 4
"Bioscience did better than what we thought they could do
and you can see expense control through the income statement,"
said Avondale Partners analyst Daniel Owczarski.
Baxter expects 2010 sales to rise 2 percent to 3 percent,
excluding the impact of foreign exchange, and earnings of $3.96
to $3.98 per share, before special items.
Last quarter, the company had forecast sales growth of 1
percent to 3 percent, excluding foreign currency and
adjustments, and earnings of $3.93 to $3.98 per share, before
"This new guidance range is likely conservative, with
Baxter's CEO emphatically stating in the first quarter that he
did not intend to have to lower guidance again. And this new
guidance would suggest that current 2010 Street estimates ...
are too low," Wise said.
Baxter shares were up $1.96, or 3.9 percent, at $51.35 in
late morning trading on the New York Stock Exchange.
(Reporting by Debra Sherman; Editing by Steve Orlofsky and