Quest Diagnostics Q3 Profit Climbs On Gain, Cuts Full-year View - Update

(RTTNews) - Quest Diagnostics Inc. (DGX), a provider of diagnostic information services, Thursday reported a sharp increase in third-quarter profit, benefited by a gain on sale and a decline in operating costs and expenses. Revenues fell from last year. Further, the company cut its earnings and revenue view for full-year 2013.

Steve Rusckowski, president and CEO of the company said, "We are disappointed with our third quarter performance, particularly after generating revenues early in the period that were in line with our expectations. Healthcare utilization and reimbursement continue to be a headwind for our industry, and our results reflect that."

In the third quarter, net income attributable to the company's common stockholders climbed to $405.1 million or $2.68 per share from $163.1 million or $1.01 per share in the previous year.

Income from continuing operations was $2.66 per share, compared to $0.98 per share a year ago.

The company said its reported income from continuing operations in the third quarter of 2013 was favorably impacted by a gain on sale of Ibrutinib royalty rights of about $1.97 per share.

Adjusted earnings from continuing operations were $1.02 per share, while the company posted $1.15 in 2012.

On average, 21 analysts polled by Thomson Reuters expected the company to earn $1.17 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenues for the quarter declined 1.9 percent to $1.79 billion from $1.82 billion last year. Analysts expected revenue of $1.82 billion for the quarter.

Total operating costs and expenses fell to $1.10 billion from $1.52 billion a year earlier.

For full-year 2013, the company now expects earnings per share from continuing operations, before special items, to be in the range of $3.85 to $3.95, down from the prior forecast of $4.35 to $4.50 per share.

Revenues are now expected to be about 3.5 percent below the prior year. Earlier, the company said its revenue expectation for the year was 1 to 2 percent below last year level.

Analysts expect the company to report full year earnings per share of $4.23, on revenue of $7.22 billion. DGX is currently trading at $57.94, down 1.38 percent.