Stronger US sales bolster Baxter's 2Q profit

DEERFIELD, Ill. (AP) — Baxter International Inc. said Thursday its net income rose 7 percent in the second quarter on one-time gains and better sales of a hemophilia drug, blood plasma products, and dialysis devices.

Baxter's bioscience business reported better sales of its hemophilia drug Advate, specialty plasma products, and surgical sealants, and its medical products unit benefited from increased sales of dialysis treatments, injectable drugs, and nutritional therapies. The company reported one-time gains related to money it set aside to cover a recall of its Colleague infusion pumps and estimated milestone connected to an acquisition.

The company said its purchase of medical device maker Synovis Life Technologies in February and drug delivery technology company Baxa in late 2011 both helped its sales.

Baxter's net income rose to $661 million, or $1.19 per share, from $615 million, or $1.07 per share, one year ago. Excluding one-time gains and expenses, the company earned $1.12 per share in the most recent quarter. Its revenue increased 1 percent, to $3.57 billion from $3.54 billion.

Analysts were expecting Baxter to report income of profit of $1.11 per share and revenue of $3.54 billion, according to FactSet.

Baxter said its international sales slumped because the dollar became stronger relative to other countries. Its international sales sank 2 percent to $2.07 billion while U.S. revenue grew 6 percent to $1.5 billion.

Revenue from its medical products unit grew 1 percent to $2.01 billion and bioscience revenue rose 1 percent to $1.57 billion. In both businesses, U.S. sales improved and sales in other countries declined.

Looking ahead to the third quarter, Baxter expects to report adjusted income of $1.12 to $1.14 per share with sales growth of about 1 percent, or roughly $3.51 billion in revenue. Analysts expect income of $1.16 per share and $3.53 billion in revenue, on average.

The company maintained its projections for the full year, saying it expects an adjusted profit of $4.50 to $4.56 per share and revenue growth of 2 percent, to a total of about $14.17 billion. Analysts are forecasting a profit of $4.52 per share and revenue of $14.17 billion.

Baxter also announced a manufacturing agreement with Sanquin Blood Supply Foundation, a nonprofit based in the Netherlands. Sanquin will help make plasma products like Gammagard Liquid and Flexbumin starting in 2014 and reaching maximum production by 2016. The companies did not disclose financial terms of the 10-year deal.

Gammagard Liquid is used to treat weakened immune systems and multifocal motor neuropathy, which is marked by progressive weakness in the limbs. Flexbumin is used to treat a variety of blood-related conditions including low levels of plasma and albumin.

Shares of Baxter International rose 43 cents to $56.60 in afternoon trading.