CareFusion Q2 Profit Meets View, Revenues Top; Backs 2014 Outlook

(RTTNews) - Medical device company CareFusion Corp. (CFN), formed through a spin-off from Cardinal Health Corp. (CAH) in 2009, reported Monday a profit for the second quarter that decreased from last year, despite revenue growth, reflecting lower margins. Adjusted earnings per share matched analysts' expectations, while quarterly revenues topped their estimates. The company also reaffirmed its earnings and revenue growth guidance range for the full-year 2014.

"Our team executed well during the quarter, with continued strength across the board in Procedural Solutions and in the Infusion Systems business line. During the quarter, we also secured a record number of committed contracts in the Dispensing Technologies business line, giving us the necessary momentum to drive strong second-half results," Chairman and CEO Kieran Gallahue said in a statement.

The San Diego, California-based company reported net income of $97 million or $0.45 per share for the second quarter, lower than $108 million or $0.48 per share in the prior-year quarter.

Excluding items, adjusted income from continuing operations for the quarter was $116 million or $0.54 per share, compared to $121 million or $0.54 per share in the year-ago quarter.

On average, 14 analysts polled by Thomson Reuters expected the company to report earnings of $0.54 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues for the quarter grew 1 percent to $922 million from $909 million in the same quarter last year, and topped twelve Wall Street analysts' consensus estimate of $911.13 billion.

Medical systems revenues for the quarter declined 2 percent to $587 million, while procedural solutions revenues declined 9 percent to $335 million from $307 million in the year-ago quarter.

Operating margin for the quarter contracted 120 basis points to 19.6 percent from last year, as gross margin decreased 90 basis points from last year.

"In addition, we made progress against our long-term strategy, gaining scale globally through the acquisitions of Sendal and Vital Signs and building a healthy innovation pipeline in Procedural Solutions," Gallahue added.

Looking ahead to fiscal 2012, CareFusion continues to expect adjusted earnings from continuing operations in a range of $2.30 to $2.40 per share, on projected annual organic revenue growth of 1 to 4 percent.

Street is currently looking for full-year 2014 earnings of $2.34 per share, on annual revenues of $3.70 billion.

CFN closed Monday's regular trading session at $39.80, down $0.97 or 2.38% on a volume of 2.23 million shares. However, the stock gained $0.80 or 2.01 in after-hours trading.