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UPDATE 2-BioScrip Q4 beats estimates, reaffirms 2010 outlook
February 26, 2010 / 11:56 AM / in 8 years

UPDATE 2-BioScrip Q4 beats estimates, reaffirms 2010 outlook

* Q4 EPS $0.99 vs. est $0.10

* Q4 rev $341.6 mln vs. est $339.7 mln

* Reaffirms 2010 outlook

* Shrs up as much as 12 pct (Recasts; Adds analyst comments, updates stock movement)

By Krishnakali Sengupta

BANGALORE, Feb 26 (Reuters) - BioScrip Inc (BIOS.O) posted a better-than-expected quarterly profit, helped by the reversal of the company’s deferred tax valuation allowance, and reaffirmed its 2010 outlook, sending its shares up as much as 12 percent.

The fourth-quarter net income included the reversal of the company’s deferred tax valuation allowance of $41.1 million and expenses related to the pending acquisition of Critical Homecare Solutions.

“The accounting rule earlier did not allow them to utilize their net operating loss carry forward because there was some uncertainty about whether they will be profitable or not,” Dougherty & Co LLC analyst Brooks O‘Neil told Reuters.

The reversal of the tax valuation allowance basically assumes that they will be profitable going forward, he added.

Last month, BioScrip said it will acquire privately held Critical Homecare Solutions for $211.2 million in cash and stock. [ID:nSGE60O0HP]

Analyst O‘Neil said that the expansion of BioScrip’s home infusion business positions the company to complete the acquisition of Critical Homecare Solutions, which he views as “very positive” for the company.

The analyst has a “buy” rating on the stock.

For the fourth quarter, the company posted a net income of $40.7 million, or 99 cents a share, compared with a net loss of $76.6 million, or $1.98 a share, in the year-ago quarter.

Revenue fell about 7 percent to $341.6 million.

Analysts on average expected the company to earn 10 cents a share, on revenue of $339.7 million, according to Thomson Reuters I/B/E/S.

The company reaffirmed its outlook for 2010 and said it expects the combined company to generate about $1.67 billion to $1.73 billion in revenue and gross profit of $267.0 million to $277.0 million. [ID:nSGE60O0HP]

Analysts on average were expecting revenue of $1.64 billion in 2010.

Shares of the specialty pharmaceutical healthcare company rose to as much as $7.97 in early trade Friday on Nasdaq, but pared some of those gains and were trading up 5 percent at $7.49. (Reporting by Krishnakali Sengupta; Editing by Aradhana Aravindan and Unnikrishnan Nair)

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