PerkinElmer Inc bounced back from a disappointing quarter with a strong start to the year, as the scientific instruments maker reported higher-than-expected first-quarter profit and raised its full-year earnings forecast by 10 cents.
PerkinElmer now sees adjusted 2016 earnings of $2.75 to $2.85 per share, which is more in line with analysts' previous forecasts. The company in February forecast full-year adjusted earnings of $2.65 to $2.75 per share, leading analysts to lower their estimates on average by 11 cents to $2.71.
"We feel generally better about the end markets and therefore more confident in our ability to forecast a much stronger bottom line," PerkinElmer Chief Executive Robert Friel said in a telephone interview.
The 10-cent increase to the forecast range was "made up of about 6 cents from the operational strength we saw in the first quarter and about 4 cents associated with the foreign exchange rate movement since a couple of months ago," Friel said.
"We are forecasting the second quarter fairly similar to the first with 4 percent organic growth," Friel added.
Excluding one-time items, the company, which also makes medical diagnostic and environmental and food testing products, earned 56 cents per share, topping analysts' average expectations by 5 cents, according to Thomson Reuters I/B/E/S.
The company saw double-digit sales growth in its food safety testing business and in newborn and prenatal screening, with particular strength outside the United States, Friel said, adding that business had also picked up from pharmaceutical and biotechnology customers.
PerkinElmer posted a net profit $47.5 million, or 43 cents per share, compared with a profit of $40.3 million, or 36 cents a share, a year ago.
Revenue for the quarter of $538.7 million edged past Wall Street estimates of $532.7 million. Profit and revenue had missed expectations in the prior quarter.
The widespread Zika virus outbreak in South America and elsewhere impacted aspects of PerkinElmer business both negatively and positively.
Newborn screening was down in South America, the CEO said, as people put off having babies over fear of severe birth defects that may be caused by Zika infection.
On the flip side, "some of our instruments are being used by researchers in Brazil and the United States to do some analysis on Zika ... to screen compounds trying to understand the disease mechanism a little better."
(Reporting by Bill Berkrot; Editing by Bernard Orr and James Dalgleish)