Abbott Laboratories records a 16% lower profit in the first quarter

Abbott Laboratories (NYSE:ABT) said on Thursday that its profit in the first quarter declined by 16%. The American medical devices and healthcare company attributed the decline primarily to a tax expense. Owing to the rising Coronavirus uncertainty, the company also suspended its financial guidance for the full-year on Thursday.

Following the announcement, Abbott was reported around 1.5% up in premarket trading on Thursday. At the time of writing, Abbott is exchanging hands at £75.40 per share in the stock market that translates to around 10% increase in 2020 so far. In late March, the stock had dropped to as low as £51 per share.

Abbott’s Net Sales Increase By 2.5% In The First Quarter

At £451 million (25 pence per share), Abbott’s net earnings in the first quarter came out significantly lower than £538 million (30 pence per share) that it recorded in the same quarter last year.

The healthcare company also highlighted a 2.5% increase in its net sales in the quarter that on 31^st March to £6.18 billion. Experts had forecast the company to record £5.87 billion in net sales in the first quarter.

According to Refinitiv, analysts had expected Abbott to make 46 pence of earnings per share in the recent quarter as compared to a higher 52 pence of earnings per share (adjusted) that the medical devices company printed on Thursday.

Abbott Laboratories has so far introduced three diagnostic tests for COVID-19 in the U.S. Its most recent test launched earlier this week detects the presence of antibodies against the Coronavirus in patients that offers valuable insight into whether or not the individual had the virus in the past. The test helps identify if the patient had recovered earlier or was asymptomatic.

Abbott’s Diagnostics Unit Posts A 1% Decrease In Sales

In its report on Thursday, Abbott also highlighted a 1% decrease in its diagnostics unit sales. The company said that a surge in demand for its COVID-19 tests was not sufficient to offset the drop in the demand for other diagnostic tests that it makes.

Its nutrition products division, however, recorded a 6.3% increase in sales to £1.52 billion that Abbott attributed to the rising demand for children’s products in the last week of March.

In 2019, Abbott’s performance in the stock market was fairly upbeat with an annual gain of just under 25%. At the time of writing, the healthcare company is valued at £132 billion and has a price to earnings ratio of 46.24.