Qiagen Q2 profits rise on genetics test kits

By Mantik Kusjanto

FRANKFURT, Aug 4 (Reuters) - Qiagen NV (QGEN.O) (QGEN.DE) reported a 57 percent increase in quarterly adjusted net profit on Monday thanks to strong demand for genetic test kits for dignosing diseases. It raised its 2008 earnings guidance.

Second-quarter adjusted net profit was $40.4 million, compared with an average estimate in a Reuters poll of six analysts of $39 million.

Net sales at the Netherlands-based company rose 61 percent to $217.9 million, helped by its $1.6 billion acquisition of Digene Corp.

"We saw strong revenue and net income growth and continue to expand our leadership and strategic position," Chief Executive Peer Schatz said in a statement.

The company also raised its 2008 earnings guidance thanks to the smooth integration of Digene, which Qiagen bought last year to expand into testing for cervical cancer and sexually transmitted diseases.

Qiagen said it now expected revenue of between $889-$919 million and adjusted earnings per share (EPS) of $0.79-$0.80. Previously, it expected EPS of $0.76-$0.80, excluding a 2-cent dilution from the acquisition of Corbett Life Science instrumentation company last month.

"Our cost savings from Digene integration will clearly exceed $45 million this year," Chief Financial Officer Roland Sackers told Reuters in an interview.

The company had aimed for $35-$45 million in costs savings from the Digene acquisition.

With Digene now integrated, Sackers said the company would be able to look for fresh targets. He said Qiagen could spend a triple-digit million-dollar amount for earnings-accretive acquisitions thanks to its strong balance sheets.

Digene's flagship product is a test for the detection of human papillomavirus (HPV), the cause of essentially all cervical cancers. The market for HPV testing is estimated to be worth more than $1 billion. (Edited by James Regan)